U.S. residential properties sold at an estimated annualized pace of 5.5 million in July, which is up 11% from last year, according to RealtyTrac’s Residential & Foreclosure Sales Report.
The July year-over-year increase represents the biggest annual uptick in sales volume so far this year, the Irvine, Calif.-based data provider said.
On a monthly basis, July sales volume was 4%
While sales volume continued to increase nationwide, eight states posted annual decreases in total sales, including California (down 17%), Arizona (11%), Nevada (7%), and Georgia (2%). At the same time, these four states had the largest increases in median home prices since July 2012, with California up 31%, Nevada up 27%, Arizona up 21% and Georgia up 20%.
Conversely, the biggest markets where sales volume increased on a yearly basis were Chicago (up 27%), Minneapolis (23%), Baltimore (21%), Boston (20%) and Philadelphia (20%).
The national median sales price was $174,500 in July, up 4% from the previous month. It is also up 6% from last year, marking the 16th consecutive month where median home prices have increased annually after bottoming in March 2012.
Meanwhile, the median price of a distressed sale—in foreclosure or bank-owned—was $120,000, a moderate uptick of 1% from June, but down 1% from a year ago. This figure is 37% below the median sales price of a nondistressed residential property.
“Low inventory of homes available for sale is proving to be a double-edged sword in many local housing markets that have bounced back quickly from the real estate slump,” said Daren Blomquist, vice president at RealtyTrac. “Home prices are accelerating rapidly in these markets thanks to the combination of low supply and strong demand. However, counter to the national trend, sales volume in these markets is down even as the percentage of cash sales rises, indicating there is still strong demand but that buyers who need financing to purchase are increasingly left out in the cold.”
Cash sales accounted for 40% of all July residential property sales, while 14% of the transactions were short sales, and institutional investor purchases and REO sales both made up 9% of the deals.
Short sale activity in July was most popular in Nevada, Florida, Maryland, Washington and Tennessee. Metropolitan areas with the highest percentage of REO sales included Detroit, Modesto, Calif., Stockton, Calif., Las Vegas and Cleveland.
Sheldon Detrick, CEO of Prudential Detrick/Prudential Alliance Realty, covering the Oklahoma City and Tulsa markets, said that increasing cash sales nationwide are a concern, especially given the adoption of the Qualified Mortgage guidelines that are set to go into effect in January.
“That is going to put more pressure on the lenders to be a lot more circumspect about who can qualify for a loan,” Detrick said. “It’s going to require 20% down on all loans and higher credit scores, and there are some estimates out there that possibly 25% to 43% of buyers will not be able to qualify for a loan after January 10.”
