The latest Ten-X Residential Real Estate Nowcast, a predictive indicator of existing home sales, reports sales will increase slightly in November, rising to a seasonally adjusted annual rate (SAAR) between 5.32 and 5.61 million with a targeted number of 5.50 million, up 0.3% from the National Association of Realtors’ reported October sales.
“Both October and November existing home sales figures have probably been distorted a bit by the hurricanes that impacted real estate transactions in Florida and Texas,” said Ten-X Executive Vice President Rick Sharga. “At least part of the reason November sales appear to be higher is that sales activity has improved significantly across the South, which represents about 40% of home sales, after a temporary dip due to the storms. But it seems unlikely that home sales will carry this momentum into the new year unless inventory levels improve dramatically.”
The November Ten-X Residential Real Estate Nowcast predicts that median existing home prices will continue to make annual strides falling between $234,440 and $259,118 with a target price point of $246,779, up 0.1% from October and 5.1 percent from last year.
“While the combination of a firm labor market and low mortgage rates has certainly strengthened home buying demand, the housing market continues to face a number of challenges, most notably inventory constraints that are exacerbated by rising homeowner tenure, fewer foreclosures and elevated construction costs,” said Ten-X Chief Economist Peter Muoio. “Moving into 2018, the looming potential for higher mortgage rates and tax reform, which may include a revision of the mortgage interest deduction and the elimination of private activity bonds, could present further obstacles.”
