According to the National Association of Realtors, existing home sales for the month of April dropped 1.9% month over month versus an expected decline of 0.8%. With higher mortgage rates and lofty price tags, what does this signal for the larger housing market?
Yahoo Finance Reporter Dani Romero joins Wealth! to break down the existing home sales numbers.
For more expert insight and the latest market action, click here to watch this full episode of Wealth!
This post was written by Nicholas Jacobino
Video Transcript
We've also got a fresh read on the housing market, of course.
Williams Sonoma Tracking this too The housing market this morning Sales of previously owned homes fell in the month of April as homeowners continue to face pressures of higher mortgage rates and rising prices.
Yahoo Finance reporter Danny Romero has the full breakdown.
Hey, Danny Brad, The housing market is still really frustrating right now for buyers, sales of previously owned homes dropped 1.9% in April to a seasonally adjusted annual rate of 4.14 million U uh, units.
Now that's what the National Association of Realtors reported.
Remember, these sales represents homes closed in February and March.
That's when mortgage rates were hovering around that 7%.
Now, home prices have not come down at all.
The median sales price is about $408,000 and that's up 5.7% over the last year.
Now, inventory good news has gone up over the past four months, landing at 1.2 million units, and this was the last time we saw this high was last October, and one of the reasons why we are seeing a jump in inventory could be the turnover from new sales, meaning that people who bought a new home S stayed in their new home for maybe about a year or two.
And so that turnover rate is actually factored into the existing home sales market.
So, um, another interesting part of this, uh, report was that first time buyers took 33% of the sales in April, and that is the largest share since January of 2021.
And like we referenced before on this show is that Millennials and Gen Zers, especially the young millennials, are saving up for that down payment.
Uh, later on in life and and they're just, you know, it seems more financially feasible for this demographic.
So that was really interesting of this report that these first time buyers really are getting more skin in this game.
Home buying game Well has a lot to do with, of course, family formation as well.
And then just looking at opportunities that are out there right now and potentially, uh, some refinancing that could come forward in the future as well.
From that cohort and extremely important to the home buying situation.
Also a new report from Realtor.com shows the cost of renting apartments is actually dropping across the country.
So so where can where can I get a deal?
Where am I commuting in from?
Rent is slowing down on a yearly basis.
Let's just put that on a on the table right now.
The median price for an apartment fell to $1700 in April.
But where can you find this deal?
It's the South.
Austin, Texas comes to mind.
Uh, it's down about 100 and $95 lower from September peak of 2022.
And the reason is because there's an influx of supply in that area.
Um, a lot of builders got to work during the pandemic to build apartments, so that has really, um, added some pressure and put down some of those rent prices.
Another market where you could really find some.
A good deal is Las Vegas, Nevada.
You know, some casino time, probably, and San Francisco, California is another one, but there still remains some pressure, especially in the Midwest, like Indianapolis Milwaukee, But overall, this is really good news for renters.
But I have talked to some experts, and they are hinting that there could be some pressure ahead on rents.
The fact that builders have pulled back on multifamily starts so there might not be as much inventory being added to the market.
Well, I don't think we have a Yahoo Finance Austin, Texas, bureau just yet.
So it might be time to break ground there.
Danny.
Thanks so much.
Appreciate it.