Despite number of listings, demand for homes slips
Posted on Monday, June 16, 2014 at 8:47:58 AM
The past several months have been particularly good to the national housing market. Residential financing rates are historically affordable, and an increasing number of homeowners are returning to positive equity. While these trends are good news, a recent report indicated that a slowdown has started to take place across the country.
According to Redfin, the number of homes sold by the real estate brokerage declined 10 percent from April to May. This statistic comes even as available listings tick up 9.1 percent during that time, its highest point in four years. As an added bonus, however, home price increases have begun to slow down toward a healthy rate.
"Housing is at an inflection point, where traditional buyers are needed to fill the gap in demand left by waning investors who dominated the market last year," said Redfin chief economist Nela Richardson. "Low wage growth has stunted demand in some metros; others have been plagued by persistently low inventory."
In addition, Min Zhu, deputy managing director of the International Monetary Fund, said in a statement that more attention must be paid to the housing market in order to address potential issues. Zhu explained that finding over-valuation in real estate segments is important, but close analysis and in-depth judgment is needed to make accurate predictions.