08/26/2022

"Obviously, I see that all the houses in the neighborhood are dropping in price and have been listed for many days without selling, so why do I see the data that prices continue to hit new highs and listing times have shortened?"

Since the first half of the year, despite the continued decline in transactions in the real estate market, but the price is a record high, the reality of the real estate market seems to have been in a state of divergence from the data, many people wonder: in the end, who should believe in?

On August 18th, the latest real estate market report from the National Association of Realtors showed that the data have finally returned to reality.

Today we'll give you an analysis based on the latest U.S. housing market report for July from NAR.

Divergence between unsold home volumes and prices disappears

Year-on-year change in sales of houses in various price categories
Source from National Association of Realtor

As can be seen from the year-over-year changes in home sales in various price ranges, the number of homes sold in the U.S. under $500,000 decreased significantly, while sales of homes over $500,000 increased by 2% to 6.3% compared to the same period last year.

This data shows very directly that the number of real estate investors is growing.

This is because real estate prices have regained value. When interest rates are low, it is relatively fair for everyone and everyone can fulfill the dream of home ownership, but when interest rates are high, those who cannot afford higher monthly payments and down payments lose out.

Because of polarization, cash-rich buyers hold the market power, buying more and more and more expensive homes, while the cheaper homes that the general public can afford remain stagnant in the high-interest rate environment.

For this reason, the median price of homes for sale increased in the first half of the year, despite rising interest rates.

Realtors Confidence Index Survey
Source from National Association of Realtor

Another phenomenon: the listing period has become even shorter! As you know, last year was the hottest year for the real estate market, and the offer period was only 17 days in July, while the current figure is 14 days.

When cost-effective properties appear in an already undersupplied market, the battle for investors is speed, and established investors are heavily involved in buying and selling properties, so offer times are shortening.
Enthusiasm from foreign investors bucks the trend
As the U.S. real estate market begins to cool, foreign buyers are bucking the trend of enthusiasm.

The report shows that the total value of residential real estate purchased by foreigners in the U.S. reached $59 billion from April 2021 to March 2022, up 8.5 percent from a year earlier and breaking a three-year trend of decline.

For foreign homebuyers, the market is pretty good now, after all, there are fewer domestic buyers in the U.S. and less competition to buy a home, which is actually good for buyers who can afford it.

If you have already found the right investment property, do not miss out on the "No Doc, No Credit" program - the loan process has never been easier and free of any strings attached, helping you realize your investment dream faster!

Statement: This article was edited by AAA LENDINGS; some of the footage was taken from the Internet, the position of the site is not represented and may not be reprinted without permission. There are risks in the market and investment should be cautious. This article does not constitute personal investment advice, nor does it take into account the specific investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, opinions or conclusions contained herein are appropriate to their particular situation. Invest accordingly at your own risk.