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February 2017 Potential Home Sales
- Potential existing-home sales decreased to a 5.7 million seasonally adjusted, annualized rate (SAAR).
- This represents an 89.8 percent increase from the market potential low point reached in December 2008.
- In February, the market potential for existing-home sales fell by 0.5 percent compared with a month ago, a decline of 28,000 (SAAR) sales.
- Currently, potential existing-home sales is 658,000 (SAAR) or 11.5 percent below the pre-recession peak of market potential, which occurred in July 2005.
Market Performance Gap
- The market for existing-home sales is underperforming its potential by 2.5 percent or an estimated 142,000 (SAAR) of sales
- Last month’s revised underperformance gap was 4.5 percent or 260,000 (SAAR) sales.
“Steady income and job growth combined with increased building permit activity has increased the market potential for home sales on an annual basis,” said Mark Fleming, chief economist at First American, in a statement. “Demand from millennials and first-time homebuyers remains robust despite the strong spring sellers’ market and rising rates, resulting in a shrinking underperformance gap, as the market aligns with its potential.”
- February 2017 home sales were down 0.02 percent from February 2016.
- Active inventory reached a record low for February, dropping 17.9 percent year-over-year. Average days on market dropped from 75 in February 2016 to 68 in February 2017.
- The median sales price was $212,000, up 6 percent year-over-year.
Home equity rates:
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ATTOM Data Solutions released its Q1 2017 Single Family Rental Market report, which ranks the best U.S. markets for buying single family rental properties in 2017.
- Counties in Georgia, Maryland, Pennsylvania post highest single family rental returns
- Among 40 counties with a population of at least 1 million people, those with the highest gross rental yields were Wayne County, Michigan, in the Detroit metro area (17.3 percent); Cuyahoga County, Ohio in the Cleveland metro area (13.2 percent); Allegheny County, Pennsylvania, in the Pittsburgh metro area (10.6 percent); Philadelphia County, Pennsylvania (10.1 percent); and Franklin County, Ohio in the Columbus metro area (9.9 percent).
- Counties with the lowest annual gross rental yields were Arlington County, Virginia, in the Washington, D.C., metro area (3.4 percent); Williamson County, Tennessee, in the Nashville metro area (3.9 percent); Santa Cruz County, California (4.1 percent); Norfolk County, Massachusetts, in the Boston metro area (4.2 percent); and Santa Clara County, California, in the San Jose metro area (4.2 percent).
- Along with Santa Clara County, the lowest gross annual rental yields for counties with a population of at least 1 million were in Kings County (Brooklyn), New York (4.4 percent); Orange County, California, south of Los Angeles (4.6 percent); Fairfax County, Virginia, in the Washington, D.C., metro area (4.6 percent); and Queens County, New York (4.7 percent).
- Mortgage applications decreased 2.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 17, 2017.
- The refinance share of mortgage activity decreased to 45.1 percent of total applications from 45.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 9.0 percent of total applications, the highest level since October 2014.
- The FHA share of total applications decreased to 10.9 percent from 11.1 percent the week prior. The VA share of total applications decreased to 10.1 percent from 11.1 percent the week prior. The USDA share of total applications remained unchanged at 0.9 percent from the week prior.
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