Sales of both newly built and existing homes fell unexpectedly in July, and while it's just one month's data, it may be a signal that the housing market has hit an insurmountable hurdle. It is just plain too expensive. Home prices are higher at virtually every price point, but the gains are biggest at the low end where demand is highest.
The median price of a home sold in July hit $258,300, the highest July price on record, according to the National Association of Realtors. The Realtors divide sales figures into six different price "buckets" in their monthly report. Sales in the range of $100,000 or below were down 14 percent compared with a year ago, while sales of million-dollar and higher homes jumped nearly 20 percent.
More telling is that at the start of 2013, when home prices were just beginning to bounce off the bottom of the housing crash, the share of homes sold above $500,000 was just 9 percent of all sales. Today that share is more than 14 percent. The share of lowest-priced home sales today is less than half of what it was then as well.
"On the lower end, there is virtually no property at a very low price level anymore," said Lawrence Yun, chief economist for the National Association of Realtors. "The same property has been moved up to a different price bucket just because the prices have been rising strongly, over 40 percent price appreciation in the past five years. We are not getting the transactions on the lower end because there is virtually no inventory on the lower end."
The median price of a home sold in July hit $258,300, the highest July price on record, according to the National Association of Realtors. The Realtors divide sales figures into six different price "buckets" in their monthly report. Sales in the range of $100,000 or below were down 14 percent compared with a year ago, while sales of million-dollar and higher homes jumped nearly 20 percent.More telling is that at the start of 2013, when home prices were just beginning to bounce off the bottom of the housing crash, the share of homes sold above $500,000 was just 9 percent of all sales. Today that share is more than 14 percent. The share of lowest-priced home sales today is less than half of what it was then as well.
"On the lower end, there is virtually no property at a very low price level anymore," said Lawrence Yun, chief economist for the National Association of Realtors. "The same property has been moved up to a different price bucket just because the prices have been rising strongly, over 40 percent price appreciation in the past five years. We are not getting the transactions on the lower end because there is virtually no inventory on the lower end."
by Diana Olick, CNBC | Read more:
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