Unfamiliar Feeling For Housing: Optimism, As 11 Markets Report Double-Digit Gains In May Sales
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"The small businesses that drive the housing market are reporting signs that the industry may be experiencing a real comeback.
At the beginning of the spring selling season, real-estate agents and homebuilders were optimistic about the growing number of prospective buyers showing up at open houses and calling to inquire about listings. Now, it appears that interest has translated into sales.
"We had a terrific March, better April, and May is going to be the best closing month since 2006," says Mark Prather, whose real-estate agency, ERA Buy America Real Estate Services is in La Palma, Calif. Closings are up 50 percent this year from the same period of 2011.
It's a similar story across the country. Business is being driven by pent-up demand — many people had put off buying since before the recession. Prices are lower after plunging during the housing crisis. Rising rents are making buying more attractive.
On top of all of that, financing is cheap. Mortgage rates are at record lows — 3.75 percent for a 30-year fixed mortgage as of last week. In some areas, people are even saying it's becoming a sellers' market.
The Seattle area has shared in the rebound. More than 2,000 houses sold in King County in May; the last time that happened was August 2007. And the median sale price was up nearly 5 percent from May 2011, the biggest year-over-year increase since the market crashed."
2. The number of metro areas (and states) reporting double-digit increases in May home sales
is now up to 11 (most with gains at 20% or higher), with Birmingham reporting a 21% increase in May sales, and statewide sales in Iowa increasing by 14%, along with a 7.2% increase in median home prices.