Do Not Fear the Future
Pending Home Sales in the US took a real beating in April. The April 2020 to April 2019 year-over-year comparison (1/12 rate-of-change) posted the steepest decline on record, falling 34.6%. US Existing Home Sales fell 17.8% from March to April, establishing a record drop for the month. US New Home Sales ended April 7.8% below April 2019. Housing prices are not providing any encouragement either. The average price of houses that actually sold in April came down $19,800 from February to $364,500. It looks very bleak out there if you stop at the April numbers, but that would be a mistake.
The chart below should help eliminate any fear you may have about the future of housing through at least the near term. Mortgage applications for purchase (the blue line) are moving higher, at 8.9% ahead of this time last year.
Do not wait if you are considering buying a home. Remembering that all real estate is local, we expect home prices to be moving up in the face of tight inventory and extremely advantageous interest rates. Yes, it is harder to qualify, but it is well worth making the move at today’s prices and today’s rates.