Sales of previously owned homes declined in July, Mortgage Application volume fell, Home prices edged higher

August 24, 2016

Wednesday – August 24

The National Association of REALTORS® reported on Wednesday that sales of previously owned homes unexpectedly declined in July from June due to low inventories and higher prices. July Existing Home Sales fell 3.2% to an annual rate of 5.39 million units, below the 554,000 expected and down 1.6% from a year ago. Inventories are now at 4.7 month supply, nearly 5% below last year. The median home price was $244,100, a 5.3% increase from July 2015.

The Mortgage Bankers Association (MBA) reported on Wednesday that its Market Composite Index, a measure of total mortgage application volume, fell 2.1% in the latest week. The refinance index decreased 3%, while the purchase index was essentially unchanged. The MBA also said that the average contract rate for 30-year fixed mortgages with conforming loan balances ($417,000 or less) increased to 3.67% from 3.64% with 0.34 in points. In addition, the average contract rate for 30-year fixed mortgages with jumbo loan balances (greater than $417,000) rose to 3.62% from 3.60% with 0.35 in points.

Home prices edged higher from May to June, but are rising at a slower rate, reports the Federal Housing Finance Agency (FHFA) in its Home Price Index (HPI). The HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. The FHFA reports that home prices rose 0.2% month-over-month with a 1.2% increase from the first quarter of 2016 to the second quarter. From June 2015 to June 2016, prices were up 5.6%.