Following last month's disappointing drop in Existing Home Sales (ignored by most since other housing data provided just enough smoke and mirrors to confirm any inherent biases), May saw Home Sales surged 5.1% (handily beating expectations for a 4.4% rise after the 3.3% drop in April). At 5.35m SAAR, this is the highest rate of sales since Nov 2009 at the end of the government's last housing bailout plan spiked sales. For the 39th consecutive month, home prices rose (by 7.9% YoY) driven by prices rises at the high-end (and a 13.9% drop in prices at the low-end) but NAR's chief economist proclaimed this as sustainable (despite stagnant incomes and home prices about to take out the previous peak) but with 67% of investors paying cash for homes in May, the demand is clearly foreign as Chinese buyers surpass Canadian snowbirds as QE floods out into every asset.
Lawrence Yun, NAR chief economist, says May home sales rebounded strongly following April's decline and are now at their highest pace since November 2009 (5.44 million). "Solid sales gains were seen throughout the country in May as more homeowners listed their home for sale and therefore provided greater choices for buyers," he said. "However, overall supply still remains tight, homes are selling fast and price growth in many markets continues to teeter at or near double-digit appreciation. Without solid gains in new home construction, prices will likely stay elevated — even with higher mortgage rates above 4 percent."
The monthly swings are becoming extreme as "seasonal adjustments" try desperately to maintain a narrative...
The median existing-home price for all housing types in May was $228,700, which is 7.9 percent above May 2014. This marks the 39th consecutive month of year-over-year price gains.
The percent share of first-time buyers rose to 32 percent in May, up from 30 percent in April and matching the highest share since September 2012. A year ago, first-time buyers represented 27 percent of all buyers.
Welcome to the Oligarch recovery...
Chinese buyers have surpassed Canadian snowbirds as the dominant foreign buyers of homes in the U.S., according to the National Association of Realtors.
Purchasers from China made up 16% of international buyers who bought primarily single-family homes and condominiums in the 12-month period that ended in March, according to the survey by the National Association of Realtors.
The Chinese also dominated dollar volume of properties sold. Buyers from China purchased $28.6 billion of properties in the U.S. in the year ending in March 2015. That compares to $11.2 billion of properties that were purchased by Canadians and $7.9 billion by buyers from India. Mexicans were fourth by dollar volume with $4.9 billion of purchases.
The numbers reflect a growing interest by Chinese buyers in plunking their dollars in the relative safe haven of American real estate, where rules around owning property are well defined and the economy is viewed as strong and stable, said Jed Smith, managing director of quantitative research at the National Association of Realtors.