Home sales climb 2.3% in July

  @CNNMoney August 22, 2012: 1:20 PM ET
Existing home sales

Homebuyers are stepping up their purchases before rising prices and mortgage rates make buying more expensive.


Americans seem to be stepping up their homebuying while they can still find bargains.

July home sales rose 2.3% from June, and 10.4% from a year earlier, to an annual rate of 4.47 million, according to a report from the National Association of Realtors.

The market has been bolstered by low home prices and mortgage rates, according to Lawrence Yun, NAR's chief economist, but the inability of some potential buyers to obtain financing has cut into sales.

"The market is constrained by tight lending standards and shrinking inventory supplies, so housing could easily be much stronger without these frictions," he said.

Given the country's population growth and demographics, Yun said home sales are still below what he would consider normal, which would be between 5 million and 5.5 million.

Elizabeth Ptacek, a senior real estate analyst for KeyBank, said economic factors still limit home sales.

"Mortgages are available if people have good credit and enough cash for a down payment," she said. "But with the [slow] job growth and consumer confidence still low, even if you can get a mortgage, you have to think twice about buying."

Carmel's $5M ultimate party house

July sales came in slightly below forecasts from a panel of industry experts surveyed by Briefing.com, which had predicted an annual sales rate of 4.57 million.

Related: Best Places to Live where homes are affordable.

Stuart Hoffman, chief economist for PNC Financial, said the psychology of the market has turned. With mortgage rates coming off of historic lows and home prices on the rise, homebuyers are more likely to think that prices will rise, making them more inclined to buy.

NAR reported a rise in the median home price of 9.6% in July, compared with a year earlier, to $187,300. Listing inventory has fallen to a 6.5 month supply, down 24% from a year earlier.

NAR President Moe Veissi stressed that pricing homes at the right level is key.

"Correctly priced homes are selling quickly these days," he said. "Fully one-third of homes purchased in July were on the market for less than a month, and only 21% were on the market for six months or longer." To top of page

Join the Conversation
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.36%4.24%
15 yr fixed3.39%3.26%
5/1 ARM3.36%3.27%
30 yr refi4.34%4.22%
15 yr refi3.38%3.24%
View rates in your area
Find personalized rates:
Rate data provided
by Bankrate.com
Find Homes for sale
  • Property Type
  • Find a home in:
    New York | Atlanta | Chicago | Los Angeles
    Washington D.C | Houston | Philadelphia | More options
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.