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NEW HOME SALES REMAIN STEADY Sales of new,
single-family homes were at a seasonally adjusted annual rate
of 1,326,600 in June, according to a recent U.S. Census Bureau
report. The annual rate is 0.8 percent below the revised May
rate of 1,337,000 but is 11.1 percent above the June 2003
estimate of 1,194,000. The growth was fueled by strong population
and household growth, improving economic conditions, continued
solid investment and a favorable financing climate. The median
sales price of new houses sold in June 2004 was $209,900;
the average sales price was $262,400. The seasonal adjusted
estimate of new houses for sale at the end of June was 374,000.
This represents a supply of 3.4 months at the current sales
rate. "Buyer demand for new homes remains quite strong as
job growth proceeds and consumer confidence builds," said
Bobby Rayburn, president of the National Association of Home
Builders (NAHB). "NAHB's Housing Market Index, based on our
monthly surveys of single family builders, indicates that
the perception of an improving economy is helping to drive
the market." Three regions registered sales decreases in June,
according to the same report. The Northeast posted a 14.2
percent decline from May. The Midwest dipped 2.9 percent,
and sales in the West declined 13.1 percent. The South posted
a 9.6 percent increase for the month. All four regions, however,
posted second quarter averages that exceeded the performances
in the first quarter of the year.
HOME IMPROVEMENT SPENDING GROWS Homeowners
spent an estimated $125.8 billion on home improvements and
repairs over the past four quarters, according to a recent
report by Harvard's Joint Center for Housing remodeling activity
indicator. Spending also increased by 4 percent from the second
quarter of 2003. The Director of the Joint Center, Nicolas
P. Retsinas, said, "Job growth and increasing payrolls have
enabled homeowners to undertake more discretionary remodeling
projects." The data also implies that higher mortgage rates
have not yet slowed home sales and homeowners are feeling
more confident. Remodelers are working more hours in response
to the growing workloads, according to the report.
CONSUMER CONFIDENCE INCREASES IN JULY The
Conference Board's Consumer Confidence Index, which increased
sharply in June, posted further gains in July. The Index now
stands at 106.1, up from 102.8 in June. The Expectations Index
jumped to 105.8 from 100.8. The Present Situation Index edged
up to 106.5 from 105.9 in June. Consumers' assessment of current
conditions was somewhat mixed, but favorable overall, the
Conference Board reported. The number reporting business conditions
are "good" remained relatively flat, at 25.6 percent versus
25.8 percent in June. The number claiming that conditions
are "bad," however, edged up to 19.1 percent from 17.4 percent.
The percentage reporting jobs are "plentiful" rose to 19.8
percent from 18.3 percent. The percentage of consumers claiming
jobs are "hard to get" remained virtually unchanged at 26
percent versus 26.2 percent in June. Consumers' expectations
for the next six months were also somewhat mixed, but more
optimistic than in June, according to the report. Those anticipating
conditions to worsen declined to 7 percent from 9.1 percent.
Consumers expecting business conditions to improve remained
relatively unchanged at 23.2 percent versus 23.5 percent in
June.
Fast Facts Calif. median home price - June
04: $469,170 (Source: C.A.R.) Calif. affordability index -
May 04: 19 percent (Source: C.A.R.) Calif. highest median
home price by C.A.R. region - May 04: Santa Barbara South
Coast $1,115,000 (Source: C.A.R.) Calif. lowest median home
price by C.A.R. region April 04: High Desert $214,470 (Source:
C.A.R.) Mortgage rates - week ending 7/30: 30-yr. fixed: 6.08%
Fees/points: 0.6% 1-yr. adjustable: 4.17% Fees/points: 0.6%
15-yr. fixed: 5.49% Fees/points: 0.6% (Source: Freddie Mac)
Informatin provided by - C.A.R. Newsline is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 135,000 REALTORS® statewide.
