On March 23, 2015, Lawrence Yun, chief economist for NAR gave a press conference. According to Yun, the national median sales price for single family homes is now $204,200 which was up from a year ago by 8.2%. In the West, the median price for a single family home was $290,100 up 4.2% from February 2014.
First time home buyers made up 29% percent in February of 2015, up from 28% in January 2015 and the first increase since November 2014. Last year, first time home buyers made up 28% percent of all buyers in February of last year.
Cash deals made up 26% of all transactions in February 2015 which is down from 27% in January 2015. Compared to one year ago, cash buyers were 35% of all transactions. Individual investors bought less homes this year. The investors bought 14% of all homes in February 2015 compared to last year when they bought 21% of the homes available. Of these investors, 67% of them paid cash.
Buyers income is going up 2% but home prices are going up faster than that. The affordability for first time buyers is being negatively impacted by the low inventory. Renters who want to become first time buyers are having a challenging time. Mr. Yun says, “Rents are rising at 3.5% and they cannot even save for a down payment because they are paying a significant portion of their income towards rents.”
The inventory levels remain low in the US. We are at 4.6 months supply to exhaust. The shortage of inventory causes the prices to go up more rapidly. According to Yun the builders need to bring more homes on the market in order to give buyers more supply.