People looking to sell a house have a reason to cheer about statistics that were released regarding November real estate sales. An annualized rate of 6.54 million units was sold in November. This is an increase of 7.4% from October numbers. Even bigger, it is an increase of 45.4% from the number of units sold a year ago.
This number was a surprise to the experts. The forecast had been for November to have an annualized rate of 6.25 million units sold. The actual results surpassed that figure by over a quarter of a million units.
Home buyers snatched up these units because of many factors. Likely, the biggest factor is the home-buying credit offered by the federal government. First-time home buyers qualify for up to an $8,000 tax credit. In addition, the program has been expanded to include people who already own a home. These repeat buyers can now qualify for up to a $6,500 tax credit when they purchase a new home.
Even though both first-time buyers and repeat Doorstep reality are credited for the growth of home sales, first-time buyers deserve more credit. Normally, first-time home buyers account for 40% of home purchases. However, in November they were responsible for 51% of home sales.
All of this news is encouraging to people looking to sell a house. The federal government’s home buying program is having its desired effect to counteract the mortgage crisis and propel housing sales, especially among first-time buyers.
Another factor propelling the increase in housing sales is a drop in interest rates. A year ago the average for a 30-year, fixed-rate mortgage was 6.09%. In October it was 4.95%. November saw the rate fall to 4.88%. This is a significant decrease that has helped to spur the rise in home buyers.
Even though all of this positive news is something people looking to sell a house are cheering about, they do have a vast market to compete with. There are an estimated 19.62 million houses for sale nationwide. That is a supply that would last for three years of sales at November’s rate of sales if no new houses were to be built.
Another factor worrying people looking to sell a house is the so-called “shadow inventory.” These are houses owned by banks and mortgage companies that have not yet been put up for sale. It is estimated that there are 1.7 million houses in this shadow inventory. For any home, seller thinking about how can I sell his house this shadow inventory definitely will have an effect.