RealtyTrac: July Home Sales Up 4% Compared To June

Although rising interest rates have resulted in a decrease in mortgage application volume in recent months, home sales continue to increase, driven mainly by cash sales.

According to RealtyTrac's Residential & Foreclosure Sales Report, about 5.5 million homes were sold in July nationwide, up 4% compared to June and up 11% compared to July 2012.

July marked the biggest annual increase in sales volume so far this year, according to the report.

Interestingly, although July sales were up overall, they were down in certain key markets where home prices have been rising. Sales volume decreased in California (down 17%), Arizona (down 11%), Nevada (down 7%), and Georgia (down 2%).

Corresponding with that, the four states that posted the biggest annual increases in median home prices in July included California (up 31%), Nevada (up 27%), Arizona (up 21%) and Georgia (up 20%). This could be an indication that many potential home buyers are being priced out of those markets, due to the increase in home values as well as rising interest rates. It could also be that the cash buyers that were stimulating those markets previously are now getting tapped out.

Cash purchases accounted for 40% of all home sales in July, up from 35% in June and up from 31% in July 2012. Metro areas witnessing the biggest month-over-month jumps in cash sales share were Dallas (up 82%), St. Louis (up 66%), Los Angeles (up 32%), Riverside-San Bernardino, Calif. (up 26%), Seattle (up 21%) and Phoenix (up 21%).

Institutional investor purchases (sales to non-lending entities that purchased at least 10 properties in the last 12 months) accounted for 9% of all residential sales in July, the same percentage as in the previous month and also the same percentage as in July 2012.

Metro areas with the highest percentage of institutional investor purchases included Atlanta (25%), Tampa (22%), Palm Bay, Fla., (20%), Greenville, S.C. (19%), and Charlotte, N.C. (19%).

The report does not state what percentage of cash sales were institutional investor sales.

Short sales of underwater properties accounted for 14% of all residential sales in July, up from 13% in June and up from 9% in July 2012. States with the highest percentage of short sales included Nevada (35%), Florida (30%), Maryland (20%), Washington (19%) and Tennessee (19%).

The national median sales price was $174,500 in July, up 4% from the previous month and up 6% from a year ago. July marked the 16th consecutive month that median home prices nationwide increased annually after bottoming in March 2012.

The median price of a distressed sale – in foreclosure or bank-owned – was $120,000, up 1% from the previous month – but down 1% from a year ago – and 37% below the median sales price of a non-distressed residential property.

‘Low inventory of homes available for sale is proving to be a double-edged sword in many local housing markets that have bounced back quickly from the real estate slump,’ says Daren Blomquist, vice president at RealtyTrac. ‘Home prices are accelerating rapidly in these markets thanks to the combination of low supply and strong demand.’

Sales of bank-owned properties (REO) accounted for 9% of all residential sales in July, also the same percentage as the previous month and a year ago. Metro areas with the highest percentages of REO sales included Detroit (26%), Modesto, Calif. (25%), Stockton, Calif., (24%), Las Vegas (24%) and Cleveland (20%).

To check out the full report, click here.


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