Yet home prices continued to rise in October and mid-November. “Increasing demand, low-to-declining levels of inventory and slowly rising new home construction were cited as reasons for a continued rise in home prices,” says the Beige Book which was released Wednesday.
The Fed’s periodic report on regional economic activity report found “historically low inventories” of unsold homes in the Philadelphia, Richmond, Chicago, Kansas City and Dallas districts.
In several hot markets, such as Atlanta, Dallas and San Francisco, real estate brokers, lenders and builders remain positive about the housing market.
Brokers and builders in the Atlanta district noted the government shutdown and “confusion about the availability of government-insured mortgages” had an impact on their business. But they remain upbeat despite slowing mortgage lending and refinancing activity. “The outlook for new home sales and construction remained slightly positive,” says the Federal Reserve Bank of Atlanta.
The Federal Reserve Bank of Dallas’ housing sector “softened due to seasonal factors” and “recent large increases in new and existing home prices.”
The San Francisco district banks reported “robust sales activity” in California for “extremely high-end homes.”
However, the pace of home sales slowed in other parts of California and “dropped off substantially in Idaho.” On the other hand, “residential permit activity expanded in several regions, an encouraging sign for sustained growth next year,” the San Francisco Bank reported.