New reports about the housing market show that residential real estate is still going strong despite the ongoing affordability challenges.
Last week, the National Association of Realtors released their Pending Home Sales data for June 2023. The report below shows the number of pending home sales – which equates to the actual signed contracts on existing single-family homes and condos – rose 0.3% from May to June.
Since February, this is the first time that pending home sales have increased. This is very significant because it shows that even though mortgage rates have elevated, home buyers are starting to accept the higher borrowing costs and are moving forward with their homebuying plans.
There is still more demand for homes than there are homes available for sale, and we’ve been experiencing the price effects of the low housing supply (low inventory) for months now. Prices have been steadily rising since February, and in many areas have already eclipsed (overshadowed) the prices we saw at the peak of the market in June 2022.
Here are current 2023 monthly home price changes from top industry reports:
| January | February | March | April | May | June | 2023 Pace | |
| Case-Shiller | -0.2% | 0.2% | 0.4% | 0.6% | 0.7% | 5% | |
| FHFA | 0.1% | 0.8% | 0.6% | 0.7% | 0.7% | 7% | |
| CoreLogic | -0.2% | 0.8% | 1.6% | 1.2% | 0.90% | 0.5% | 10% |
| Black Knight | 0.1% | 0.4% | 0.5% | 0.5% | 0.7% | 5% | |
| Zillow | -0.1% | 0.1% | 0.9% | 1.0% | 1.4% | 1.4% | 10% |
Supply and demand economics are working to keep home prices steady, and the recent pending home sales numbers show there are still plenty of people out there who want to buy homes even in the face of the higher rates.
If you want to buy but are still worried about a housing market crash, this information should offer some relief.
Today’s rates, for a single-family home purchase with excellent credit and at least 20% down:
30 Year Fixed: 6.750%/6.926%APR
15 Year Fixed: 5.990%/6.248% APR
Jumbo 10/1 ARM: 6.750%/7.368% APR
Jumbo 7/1 ARM: 6.500%/7.441%APR
I recently received the following article about consumer debt from one of my local lenders. He said, “I can tell you that over this past year, I have seen many applicants with a lot of credit card, personal and student loan debt.
In part, credit card debt has to do with the economy as some people are buying groceries and other items on credit, also part personal choice of wanting something now without saving for it and students may not be aware of the consequences of debt beyond graduation. All of this affects their home buying power as well.
Hope this information was helpful. Please don’t hesitate to reach out to me if you have any questions or are interested in buying or selling real estate in SE Wisconsin 😊
