This page has been archived and commenting is disabled.

40% Of Existing Home Sales At Or Above Asking Price, Highest On NAR Record

Tyler Durden's picture




 

Following the blockbuster housing starts and permits earlier this week, there was much hope that finally the NAR would confirm that the housing recovery was more than just another weather fabrication, and once again the dead cat has bounced, overtaking the sales high from last July. Alas, moments ago the NAR reported that after rising by 5.21 million units in March, April existing home sales dropped -3.3%, well below the 0.8% expected increase to 5.23 million.

 

As the NAR chief economist Larry Yun reported, sales in April failed to keep pace with March. "April's setback is the result of lagging supply relative to demand and the upward pressure it's putting on prices," he said. "However, the overall data and feedback we're hearing from Realtors continues to point to elevated levels of buying interest compared to a year ago. With low interest rates and job growth, more buyers will be encouraged to enter the market unless prices accelerate even higher in relation to incomes."

Unless of course low interest rates are not so low in the future.

And while we understand that increasingly more potential buyers are simply priced out of a market that only the wealthiest can access, we are confused by Yun's statement that there is lagging supply: after all the NAR in the very next sentence admits that "total housing inventory at the end of April increased 10.0 percent to 2.21 million existing homes available for sale. Unsold inventory is at a 5.3–month supply at the current sales pace, up from 4.6 months in March."

So... perhaps we need to double seasonally adjust the inventory as well?

The good news for yet one more month, is that millionaires are price indescriminate, and the median price rose once more:

The median existing–home price for all housing types in April was $219,400, which is 8.9 percent above April 2014. This marks the 38th consecutive month of year–over–year price gains and is the largest since January 2014 (10.1 percent).

Because deflation.

But the most stunning data point from today's report:

"Housing inventory declined from last year and supply in many markets is very tight, which in turn is leading to bidding wars, faster price growth and properties selling at a quicker pace," says Yun. "To put it in perspective, roughly 40 percent of properties sold last month went at or above asking price, the highest since NAR began tracking this monthly data in December 2012."

Why? Because like stocks, homes are now a trophy asset which only the wealthiest can afford:

The percent share of first–time buyers remained at 30 percent in April for the second consecutive month. First–time buyers represented 29 percent of all buyers in April 2014.

And...

Seventy–one percent of investors paid cash in April.

As noted, the Median price of existing homes is now just shy of its recent all time high:

Driven by a jump in demand for expensive housing.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Thu, 05/21/2015 - 10:27 | 6117166 Bryan
Bryan's picture

So what?  Maybe asking prices are 'artificially' low.  This one manipulated data blip means nothing.

Thu, 05/21/2015 - 10:29 | 6117174 PartysOver
PartysOver's picture

Or is Real Estate bubbling?

Thu, 05/21/2015 - 10:38 | 6117212 Soul Glow
Soul Glow's picture

People think that paying a bank interest for 30 years so they can own their own home - in 30 years mind you because they will not have the deed until then - is a way to control their lives.  Thus brings us to the AMerican paradigm - control.  People want to control their lives, others lives, their cats lives, their kids lives, control is the name of the game.

Of course this is an outlandish thought as no one controls anyone and everyone is free to do as they please; unless you owe the bank your life, then you control nothing, thus the irony of the American Dream.

ZZZZZZZZZ Sleep tight sheeple!

:)

Thu, 05/21/2015 - 10:57 | 6117263 Pairadimes
Pairadimes's picture

Here in southeast Texas, there are some local markets that have gone insane. Close to home, most houses below $500k appear to have contracts on them within a day of listing. My agent tells me she is shaking her head at how much buyers are paying above list to get to contract.

Even in previous boom times in this area, we didn't see quite this degree of insanity. We also didn't have interest rates quite this low then either. There will inevitably be many people piling in at these prices who will be underwater in the future.

Thu, 05/21/2015 - 11:13 | 6117356 PTR
PTR's picture

McMansions are back, ala 2015.

 

North side of Chicago (Lakeview, North Center and nearby surrounding neighborhoods,) where all the 5%-ers live, the new McMansion is tearing down a 50 yr old+ A-Frame or 2-flat, and building a $1.5 million, 2-story, 5 br, 3+bath home with basement, garage...and no backyard to speak of (where there was one before.)

 

I pity the fools.  

 

And I don't.

Thu, 05/21/2015 - 11:33 | 6117460 Soul Glow
Soul Glow's picture

In Portland, OR townhouses are going up like crazy.  There are more cranes on the Eastside than I have ever seen  Gentrification at its finest.

These buildings are eyesores too.  Funny Portland prides itself in being an artsy fartsy city yet the new buildings all look the same except the colors, and the colors are atrocious, like Rothko was hired to poop on them.

Thu, 05/21/2015 - 12:52 | 6117845 Thick Willy
Thick Willy's picture

Millenials are desperate to keep their wife from leaving them so even though they can't afford it, they are snatching up houses with 2% down on massive loans.

It was actually easy to get real estate started back up again, just manipulate the female oriented media (soap operas, women's web sites, magazines) and let them do the rest.  They all want their little nest for their crotchfruit to grow up in.  Price be damned!  After all, that isn't their problem, it's the man's.

Thu, 05/21/2015 - 13:26 | 6118036 Shaznardickleze...
Shaznardickleze the Doon's picture

Not all Millenials ;) 
+1 for "crotchfuit".

I explained to my wife the unprecedented scenario and we agreed to own metals now price be damned and a home later. 

Thu, 05/21/2015 - 17:58 | 6119210 FrankDieter
FrankDieter's picture

Crotchfruit is a losing proposition.  A remaining life of frustration and hard work for these wasteful entitled louts.

Thu, 05/21/2015 - 10:39 | 6117215 Headbanger
Headbanger's picture

It's just flipping houses gone wild.

Also. a rush for those wanting to actually live in a house rushing to buy BEFORE RATES BLAST HIGHER!

Thu, 05/21/2015 - 11:48 | 6117512 Trucker Glock
Trucker Glock's picture

Completely concur with your last statement.  Are you better off overpaying for a property now with 4% APR or waiting for the bubble to burst and risk paying 8% or more APR?

Thu, 05/21/2015 - 13:29 | 6118050 Shaznardickleze...
Shaznardickleze the Doon's picture

A locked in APR doesn't lock out an adjustable property tax rate. Sure would suck to not only be underwater but sodomized by the tax man.

Thu, 05/21/2015 - 10:40 | 6117220 free_as_in_beer
free_as_in_beer's picture

check mate, now comes the inflation spike.

todays mortgage will be paid off for less than tomorrows grocery bill.

Thu, 05/21/2015 - 13:31 | 6118061 Shaznardickleze...
Shaznardickleze the Doon's picture

What inflation? The word on the street is a cashless monetary system which would render all that excess paper trash outside the country to vaporize and never return home to be considered inflationary let alone hyper inflationary. Your example is a bit absurd.

Thu, 05/21/2015 - 12:22 | 6117645 jughead
jughead's picture

We are in process of selling our home and buying another.  We had 5 offers on our home within 3 days...all of them for asking or above.  Of course those that were above what we were asking were FHA and expecting us to pay their closing costs.  

Of the homes we've made offers on, we kept losing them because our offer is contingent on selling our home. Funny thing is that we're doing this not because we want a down payment, but rather so we can pay cash and avoid a mortgage altogether.  Finally, when we found a home that sent my wife into multiple orgasms, I just made the offer straight up with a conventional loan and a huge down payment...then when our current home finally closes I'll just pay off the damned mortgage.  

FYI, the soonest I could schedule an inspection is over a week away because they are so busy.  My agent is working herself into a zombie because it is so busy. Indeed, the first offer I got on my home was SIGHT UNSEEN!  Turns out, lots of people are doing that because they have lost so many other offers.  Take it from my present, albeit ancetotal, experience...the freakin housing market is nuts...and so are people.  

Thu, 05/21/2015 - 12:45 | 6117805 JLee2027
JLee2027's picture

We had 5 offers on our home within 3 days...all of them for asking or above. 

I always thought getting a price equal to your ask wasn't an "offer". It was a sale, as in "SOLD!". So how you can you still be getting offers?

Thu, 05/21/2015 - 12:34 | 6117741 Newtons Lawyer
Newtons Lawyer's picture

The Bernank said that one of their goals was to inflate the housing market.  So bubble we get.  It'll end badly just like the last one.

Thu, 05/21/2015 - 10:36 | 6117207 i_call_you_my_base
i_call_you_my_base's picture

Right, whenever I want to sell something I make the initial offer way lower than what I expect to get.

Thu, 05/21/2015 - 11:13 | 6117358 AGuy
AGuy's picture

FWIW: I do see increased sales. I see homes have been sitting for years final getting sold. It may be attributed to that people believe the Fed is going to raise rates next month, so they are rushing to buy before the increase in rates. That said, I am not sure where people are getting the money to buy. You now have to put 20% down (at least in my area). Unemployment is still very high and wages are flat to decreasing here.

 

 

 

Thu, 05/21/2015 - 16:45 | 6118977 Citxmech
Citxmech's picture

NAR only has data back to Dec 2012?  WTF?  

2-1/2 years ain't shit. 

Thu, 05/21/2015 - 10:27 | 6117168 Salzburg1756
Salzburg1756's picture

Don't believe it.

Thu, 05/21/2015 - 10:28 | 6117169 ejmoosa
ejmoosa's picture

 

The percent share of first–time buyers remained at 30 percent in April for the second consecutive month. First–time buyers represented 29 percent of all buyers in April 2014.

 

 

30 does not equal 29.....

 

If they cannot get the simple stuff right....

Thu, 05/21/2015 - 10:29 | 6117175 Richard Chesler
Richard Chesler's picture

Realtor math.

 

Thu, 05/21/2015 - 10:28 | 6117170 surf0766
surf0766's picture

IN 5 years they will go back and restate these down by 17% per month.

Thu, 05/21/2015 - 10:29 | 6117173 kaiserhoff
kaiserhoff's picture

Maybe true for city folk.

In my area nothing is moving, nada, and tis the season.  If they don't get a sale by July, forgedaboudit.

Thu, 05/21/2015 - 10:30 | 6117177 MFL8240
MFL8240's picture

Same as they did in 2007.  Crash right around the corner.

Thu, 05/21/2015 - 10:32 | 6117183 Soul Glow
Soul Glow's picture

Janet can print fiat currency to buy the debt/bonds issued ad infinum by the UST tho.  Don't we have it all figured out?

Weecovowee!!!!!!!!

:)

Thu, 05/21/2015 - 10:30 | 6117178 Soul Glow
Soul Glow's picture

Dat's bullish!

Thu, 05/21/2015 - 10:31 | 6117181 corporatewhore
corporatewhore's picture

It's a full blown mania in my fly over country suburbs.  They sell within one day.  The prices are around almost $200 per sf.  

I have to dig out my copy of "Instant Replay" and start dancing.

Thank God I'm too poor to get caught up in the madness.

Thu, 05/21/2015 - 10:35 | 6117202 Soul Glow
Soul Glow's picture

Imagine when the shoe drops and they all get caught with their pants down.

Thu, 05/21/2015 - 10:40 | 6117221 Consuelo
Consuelo's picture

As long as their socks are clean...

 

 

Thu, 05/21/2015 - 10:35 | 6117204 Glass Seagull
Glass Seagull's picture

 

 

The Blackstone undercover field bidders.

Thu, 05/21/2015 - 10:40 | 6117223 First There Is ...
First There Is A Mountain's picture

My home is going up in Denver in 2 days. I'm going to take the money and run. Average home lasts 4 days in the Denver Metro market. Friends are trying to buy right now. Bidding wars galore. Outbid on 4 fucking homes in one day.....

Fuck CO. We haven't seen the sun here in about a month and I'm not exaggerating. Call it what you want but climate is shifting here. I'm a native. Never seen anything like this in my life. We're averaging something like 4 X the normal amount of precip for this time of year. We are expected to break FUCKING 70 maybe 4 times in the entire month of May and by just a degree or two at most. If you had told me it was not going to break 80 in May I would have been floored. But 70? 

Every degenerate loser dreamer who can't cut it in their home state pouring in thinking streets are paved of gold. Going to get into the dispensary business. lol. Never seen so many fucking losers in one place in my life. Sad, used to be a great bastion of mostly Libertarian thinking. Ultra liberal pile of dog shit now. Adios, CO.....

Thu, 05/21/2015 - 10:48 | 6117254 DontFollowMyAdv...
DontFollowMyAdviceImaDummy's picture

you are very wise First There Is ... to cashout of CO right now before Delta9THC containing plants become legal everywhere... then once all those burnouts bail you'll be able to get you place back for pennies on the dollar for a ski-time vacation home :-)

Thu, 05/21/2015 - 11:24 | 6117407 macholatte
macholatte's picture

 

Many Colorado communities in and near the Front Range have seen around a foot of water since the middle of April.

 

http://denver.cbslocal.com/2015/05/20/parts-of-colorado-see-wettest-may-on-record-with-more-rain-coming/

 

Thu, 05/21/2015 - 12:20 | 6117673 Amish Hacker
Amish Hacker's picture

Any chance all of that water will replenish the Colorado River, refill Lake Mead and Lake Powell and keep the party going in Vegas for a little longer? I didn't think so.

Thu, 05/21/2015 - 10:52 | 6117270 FreeShitter
FreeShitter's picture

Colorado springs was a nice town a few years back too....but shit the sun is non existant for 6+ months of the year...fucking depressing.

Thu, 05/21/2015 - 13:36 | 6118083 Shaznardickleze...
Shaznardickleze the Doon's picture

Silly to think something like sun rays would make a grown man this sad. Try Washington state, you guys are QQ for seasonal depression because CO isn't sunny this year. Hilarious.

Fri, 05/22/2015 - 10:31 | 6121368 Skiprrrdog
Skiprrrdog's picture

I saw a UFO while driving down I25 a few years ago, just a few miles north of NORAD... and this was before the legal weed...

Thu, 05/21/2015 - 12:57 | 6117888 Thick Willy
Thick Willy's picture

Colorado is heaven on Earth compared to pretty much anywhere on the East coast.  There will be no shortage of people to take your place.  Where are you going to go that's better?  There really isn't anywhere better than Colorado if you enjoy the outdoors.

Fri, 05/22/2015 - 10:37 | 6121390 Skiprrrdog
Skiprrrdog's picture

My brother lives in Battery Park and there is not enough money on the planet to get me to live in that overpriced, reeking and overcrowded shiza-hole...

 

Fri, 05/22/2015 - 10:24 | 6121343 Skiprrrdog
Skiprrrdog's picture

I moved to Arizona from Golden ten years ago. So far we have not seen one single triple digit day, and have had more moisture in the last three months than in all of the ten years I have been here, and it is windy, cloudy and cooler every day. People are getting their panties in a wad over the economy, but something pretty fucking strange seems to be winding up off-stage...

Thu, 05/21/2015 - 10:44 | 6117239 the grateful un...
the grateful unemployed's picture

how much is foreign investment, which is really just recycled hot money from the EMs. a lot. the fed wants to bash cash, follow the fed, buy assets. the difficulty is that interest rates rise the spec goes off. so its all in the timing. its like tip bills, a few years they were hated by just about everyone, and you could buy them at a discount to par. yes the usg was selling you $100 bond for $95 dollars, but when the window closes you have to pay a premium. still if you own tips and inflation goes up you are okay, especially if you bought in when sentiment was low. you dont want to chase these kinds of markets. just like you dont want to chase gold when it starts on a parabolic run.

Thu, 05/21/2015 - 10:46 | 6117243 Laddie
Laddie's picture

One has to wonder what significance items, all too common, such as the following have on the housing market:

Immigrants to U.S. From China Top Those From Mexico
By Neil Shah Updated May 3, 2015
Increasing numbers move to study, work and unite with families in the country
China and India have taken the lead on sending immigrants to the U.S.

Chinese Buyers Are Snapping Up 1 in 5 New Homes in Sydney and Melbourne

Thu, 05/21/2015 - 10:47 | 6117251 TheGreatRecovery
TheGreatRecovery's picture

It seems to me that average PER SQUARE FOOT PRICE of environmentally-regulated (heated or air conditioned) space would be a better thing to keep track of. 

Or just the current value of VNQ.

Thu, 05/21/2015 - 10:48 | 6117255 aeslong
aeslong's picture

lying, look at my area (southern ca), very slow, plentiful houses on market do not move at all, and price way below historical high.

Thu, 05/21/2015 - 11:07 | 6117333 Solarman
Solarman's picture

I don't where you live, but homes in my neighborhood are up 10% year over year, and homes are selling in days, and at full price.

 

Orange County, Coastal, but not beach.

Thu, 05/21/2015 - 11:26 | 6117426 Not My Real Name
Not My Real Name's picture

I live in SoCal (NW Orange County) and things are hopping here. My neighbor is the kind nobody ever want to have living next door -- a single mom on disability (for depression -- yes, that is a "disability") with five yapping dogs who bark at all hours of the day, and she never keeps up her yard, even though she has two young adult pot-smoking losers for sons that still live with her. So, needless to say, the wife and I were ecstatic when we found out she was selling her home because she could no longer afford to make the payments. I figured her place would never sell because she was asking slightly over market price ($629,000), despite never making a single upgrade since it was purchased brand new 17 years ago. Long story short: Her dump sold in 5 days -- and the buyers aren't from mainland China either. Now I'm keeping my fingers crossed that the markets don't crash before escrow closes.

Thu, 05/21/2015 - 13:00 | 6117907 Senseless Urina...
Senseless Urinal Cake's picture

Congrats NMRN!  Had the same experience up in the East Bay.  Nearest neighbor's place about an arms length out the window on disability for 21 years for "depression".  A disgusting creature whose only goal apparently was to make life as miserable for everyone else as her shitty existence.  She would get combative over the tiniest little things such as a paper towel ending up in a the recycling bin.  When I pointed out to her that weekly she was tossing out pounds of cat shit wrapped in plastic bags, well that's when any neighnborly feelings stopped. She had full blowen toxioplasmosis.  

Median price for homes in our area is USD858,000 for one bath two bedrooms around 1,400 sq. ft with zero improvements in decades and they sell like hotcakes within days.  With little water, crazy food and fuel prices it was time to go. Callie is such a beautiful state but it is well beyond carrying capacity and all I felt there was dread for the near future.

Thu, 05/21/2015 - 10:53 | 6117277 Jack Daniels Esq
Jack Daniels Esq's picture

Every liberal douche in US is trying to pump-up the dumb muslim

Thu, 05/21/2015 - 11:00 | 6117298 Dumgoy
Dumgoy's picture

It's because houses are priced too cheap.  Just ask more for your flip!  

Thu, 05/21/2015 - 11:14 | 6117363 Zen Master
Zen Master's picture

Recognizing and using debt as a utility, thereby benefiting from its availability, is the key to navigate this so-called modern world. It was a huge mistake to allow this to happen, but it isn't going away. If you are fortunate enough to qualify for leverage, you would be a fool not to use it. It may be wrong for the overall peace and prosperity of the world's population...but as the saying goes "smoke'm if you got'm."

Thu, 05/21/2015 - 11:53 | 6117501 theundergroundm...
theundergroundmovement's picture

There are 6 homes on the route I take to town that have been sitting empty and in foreclosure for over 3 years now.  There are another 3 bank owned homes that are being maintained but not put on the market.  That's 9 homes within the first 4 miles of my commute that the banks are litteraly withholding from the market.  Those are the homes just on the main road.  One day I might check the side streets just out of curiosity.

Chase sat on two foreclosed homes down the road from me for 6 years before putting them back on the market just last year...

It would be called Rakateering if was not done with the governments blessing.

House Sales are brisk here in South Florida... Mostly investor chasing investor... then they rent them out while waiting for the next 10% pop, rinse, repeat...

Reminds my very much of 2007...  Oh, oops... did I just say that? 

Thu, 05/21/2015 - 13:40 | 6118106 Shaznardickleze...
Shaznardickleze the Doon's picture

Are you insinuating toxic bank assets are still being centrally planned to liquidate in bubbly market events? GASP. 

This is why I refuse to "buy" a home until the market eats shit beyond recouperation. Not long now...

Thu, 05/21/2015 - 11:47 | 6117511 steveharless
steveharless's picture

Homes Are selling Like crazy In Las Vegas!

www.ViewLasVegasRealEstate.com

Thu, 05/21/2015 - 11:50 | 6117523 fremannx
fremannx's picture

Which, of course, is the problem.

Thu, 05/21/2015 - 11:49 | 6117517 fremannx
fremannx's picture

Not a new story but definitely a sad one for those who have been fooled into believing that housing and real estate are recovering. The banking industry is trying to steal the wealth of ignorant home owners. This NOT the time to buy a house...

http://www.globaldeflationnews.com/inflation-vs-deflation-part-3how-the-...

Thu, 05/21/2015 - 13:02 | 6117915 Thick Willy
Thick Willy's picture

There is a ton of pent up demand here.  People are tired of renting.

Renting is awful and degrading.  You have no control, even in your own home.  Your biggest monthly expense goes to enrich someone else, money down the drain forever.  You can't fix the place up and make it comfortable because even if the landLORD would let you, you'd just be improving his property.

Not everyone wants to rent forever and live a disgusting and degrading life style.  You know the difference between a ghetto momma on welfare living in free housing and a middle class person renting?  The middle class person has to work and slave all day.  That's all.  They are both in the same social class and both live the same degrading life style.

Who wants to be in their 40's or 50's and not even own a home (or be close to paying it off)?

Thu, 05/21/2015 - 13:21 | 6118011 Joenobody12
Joenobody12's picture

May be more people see the writing on the wall that the paper dollar is losing value by the day. Better exchange it for something REAL.

Thu, 05/21/2015 - 13:42 | 6118112 Shaznardickleze...
Shaznardickleze the Doon's picture

So its 2008 all over again for different reasons with similar outcome.

Thu, 05/21/2015 - 15:02 | 6118531 MEFOBILLS
MEFOBILLS's picture

Housing prices are pushed by QE.  QE makes low interest rates, so new debtors can take on a lifetime of debt.  This new debt formation pushes housing prices higher.  

 

However, debt formation can only go on for so long.  Debtors become house rich and everything else poor.  Their output is vectoring to the banker, rather than buying goods and services from each other.

 

As long as you have a credit system, you have to tax the land.  People will bid up the home value, and winner is the one who takes on the biggest loan.  Banker doesn't give a damn becuause the principle disappears, and all he cares about is the usury.

If there is a money system, then neighbors are making loans to neighbors.  A neighbor will demand more than zero down, and will also be able to forgive payments if creditor gets into trouble.  Bidding up of house prices is not likely in a money system.

 

www.sovereignmoney.eu

Thu, 05/21/2015 - 17:00 | 6119029 poland spring
poland spring's picture

I thought the best time to buy is NOT when interest rates are low but when interest rates are at their highest because of the inverse relationship between rates and home prices.  If rates were 10%, wouldn't homes be worth a lot less so therefore I would be take on a lower mortgage amount?

I'm 40 and have no desire to 'own' a home because for some reason I feel that you never 'own' it but eventually 'rent' it due to taxes....so if you don't pay the tax, they take your home...and it seems that property taxes keep on rising so what is the value in that?  At least with renting, I can leave for somewhere else if they raise rents.  I dunno.

Do NOT follow this link or you will be banned from the site!