New Home Sales Steady, but Prices Jump
The Census Bureau reports that August new home sales were little changed from July. However, prices rose sharply, some believing that this indicates continued improvement in the housing market. New homes sold at an annual rate of 373,000, down 1,000 from July. This is 28% above last year’s numbers.
The median price of a new home jumped by 11% from July to $256,900. This number is an improvement of 17% year-over-year. The price improvement is attributed to a tight supply rather than a big improvement in demand.
They May Be Rising, But Prices Won’t Be Back to Peak for 10 Years
On average, U.S. home prices dropped by a third from the beginning of 2007 to the start of 2012. This number is reported by Fiserv, and that analytics firm reports that prices are expected to improve at an average annual rate of around 3.7 percent for the next five years. At that rate, prices would still be 20% below their peak. The national average peak median price of $238,000 isn’t expected to be hit again until 2023.
` Rental Space at a Premium – San Francisco Voting on Tiny Apartments
San Francisco wants to help many single renters who are currently priced out of the market. The City Supervisors are set to vote on a proposed change to the city’s building code that would allow apartments as small as 220 square feet to be built. That’s about the size of two prison cells.
Current regulations require the living room alone to be larger than that. Building plans for 300 square foot units planned for San Francisco’s South of Market neighborhood include window seats that turn into spare beds and beds that turn into tables.