Sales figures for residential property in the US are up, in spite of contract cancellations increasing substantially. Latest data from the National Association of Realtors shows sales of single family homes, townhomes, condominiums and co-op's increased by 1.4% in October to 4.97 million, compared to 4.9 billion in September. Year-on-year sales have increased by 3.5% compared to 4.38 million homes sold in the year ending October 2010.
These figures would be even better had sales not being negatively affected by this increase in contract cancellations. These are due to various factors including failed mortgage applications, loss of employment and bad home inspections. Cancellations rose by an incredible 33% in October compared to 18% in September.
Although the sales figures are slowly rising, Lawrence Yun, chief economist at the NAR thinks the market is still operating at a lower level than desired in spite of improving factors which include rising rents, increased affordability and the creation of new jobs, and feels many people who want to buy new homes are having their plans thwarted.
At the moment there are 3.33 million homes on the market, and stock levels are falling steadily with October showing a 2.2% fall leaving an eight month supply. The market reached its peak in July 2008 when they were 4.58 million homes on the market.
Some areas are also seeing a shortage of foreclosures, especially in lower priced homes where multiple bidding on desirable property is becoming more commonplace. This has prompted realtors to ask for foreclosures to come on the market at a faster rate because they have buyers ready to purchase, and giving credit to investors would help absorb inventory at a faster rate.
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