Homes sold at the fastest pace in 10 months in November

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Low mortgage rates and a strong employment market drove strong demand, driving pre-owned home sales in November for the third straight month.

According to the National Association of Realtors, pre-owned home sales, which rose to the highest seasonally adjusted annual rate since January in November, are on track for the strongest year since 2006.

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The strong housing market faces concerns about the omicron variant of the coronavirus against the backdrop of a growing economy facing pressure from high inflation. New and rapidly prevailing variants can weigh on consumer spending during the holiday shopping season, especially for face-to-face services such as travel, entertainment and eating out.

Consumer trust Rise from November to December But well below the levels seen in early summer, the Conference Board, a private research group, said Wednesday. Studies may not fully reflect the recent increase in cases caused by Omicron variants, but as of earlier this month, consumer concerns about rising prices and pandemics have eased slightly. It was shown that.

The Commerce Department also said Wednesday that the economy grew a little faster in the third quarter than previously estimated. The ministry reported that US gross domestic product increased at a seasonally adjusted annual rate of 2.3% from the previously reported pace of 2.1%.

Colin and Ariana Schwartz are about to buy their first home in the Atlanta area.


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Colin Schwartz

Housing is one of the bright spots in the economy as a whole this year. Buyers have been motivated by low interest rates, higher household savings, and the desire for more space to work from home.Demand too Big waves of millennials Aging in their major home purchase year.

Meanwhile, according to the NAR, home supply for sale fell to record lows at the beginning of the year, well below normal throughout the year. House prices have skyrocketed Buyers have been competing for a limited number of homes. According to the NAR, the median pre-owned home price in November rose 13.9% year-on-year to $ 353,900.

Holiday seasons and cold weather in some parts of the country usually reduce home sales near the end of the year. But in the last few weeks, activity hasn’t slowed down too much. Fannie Mae’s chief economist, Doug Duncan, said buyers may have rushed to buy before house prices rose further or interest rates rose.

“In general, home sales were stronger than expected,” he said.

Mortgage rates have risen slightly since the summer, but are still well below pre-pandemic levels. According to the mortgage giant, the average interest rate on 30-year fixed rate mortgages was 3.12% as of December 16.

Freddie Mac..

The US mortgage market involves several key players who play a key role in the process. Here’s what investors should understand and the risks they take when investing in the industry: The WSJ’s Telis Demos explains.Photo: Getty Images / Martin Barrow

Federal Reserve officials They could move to increase the rate As soon as the spring of 2022 comes.

According to economists and realtors, demand is likely to remain strong next year. Shoppers who have turned from frustration to bystanders are ready to return to the market if there are signs of opportunity, agents say.

Jason Moon, a real estate broker at Trueblood Real Estate in northwestern Indiana, said:

The market remains fast paced, And many homes sell above the listing price. According to the NAR, typical homes sold in November were on the market for 18 days, unchanged from the previous month.

The market is particularly low priced and highly competitive, Buyers with limited cash can get high prices Depends on the investor or cash purchaser. According to NAR, about 24% of pre-owned home sales in November were purchased in cash, up from 20% in the previous year.

The share of first-time buyers in the market fell to 26%, the lowest level since January 2014, down from 32% in the previous year.

Both Colin and Ariana Schwartz are 31 years old and are about to buy their first home in the Atlanta area.

“I feel like we have to get lucky in this market,” Schwartz said. “If a larger financial institution comes in and bids $ 30,000 higher than the asking price without looking at the property, it’s very difficult for us to counter it.”

According to NAR, the number of homes sold at the end of November was 1.11 million, down 13.3% from the previous year. At the current sales pace, there was 2.1 months of housing supply in the market at the end of November.

According to real estate agents, seasonally adjusted, the number of homes sold in November fell to a record low.

Redfin Ltd

“If you are interested in halfway [a home on the market]”You have to put your finger on the trigger to get ready, 50 people are looking at the same three homes as everyone else,” said Robbie Blow, an agent at Lafayette, Louisiana. increase.

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James Matias and Jaime Vargas Cruz bought a new home near Buffalo, NY in November.


Photo:

Dana David

Jaime Vargas Cruz and James Matthias sell a three-bedroom home in Buffalo, NY, and decide to buy a larger home after Vargas Cruz gets a new job at customer service this summer. Did. They went public in July and signed a deal within a week.

With a budget of $ 250,000, they bought a home for less than $ 220,000, so they were able to make an offer that exceeded the listing price. “We have them [listed] For $ 250,000, it’s $ 280,000 and $ 290,000, “says Vargas Cruz.

They accepted the fifth offer for about $ 260,000 and moved last month.

“We are very, very happy,” said Vargas Cruz. “This is definitely the house we are trying to grow.”

News Corp,

The journal owner also operates Realtor.com under license from NAR.

Write to Nicole Friedman nicole.friedman@wsj.com

Copyright © 2021 DowJones & Company, Inc. all rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Homes sold at the fastest pace in 10 months in November

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