Home buyers throughout the country are feeling empowered by recent low mortgage rates and eased lending standards. This empowerment has led to an important uptick in pending home sales in January. The National Association of REALTORS® reported in their Pending Home Sales Index that contract signings rose 1.4 percent to 104.2 in January from 102.5 in December. January also marked the fifth consecutive month of year-over-year gains in pending home sales with an 8.4 percent increase from January 2014.
Many economists, including NAR’s Lawrence Yun, are hoping that the housing market is finally getting the push it needs for total recovery. Factors such as dwindling inventory have played a major role in keeping home sales down. Although much has not changed on the home supply front, buyers are gaining traction in the housing market thanks to a steadying economy bolstered by stronger employment.
“Contract activity is convincingly up compared to a year ago despite comparable inventory levels,” Yun said. “The difference this year is the positive factors supporting stronger sales, such as slightly improving credit conditions, more jobs and slower price growth.”
Across the country, pending sales almost universally picked up. The Midwest was the only region in which there was a decrease noted. In the West, contract signings rose by 2.2 percent and the current 96.4 level is 11.4 percent higher than it was a year ago, which is promising for Southern California as the spring season heats up throughout the coming months.
“All indications point to modest sales gains as we head into the spring buying season,” says Yun. “However, the pace will greatly depend on how much upward pressure the impact of low inventory will have on home prices. Appreciation anywhere near double-digits isn’t healthy or sustainable in the current economic environment.”
Newport Beach Maintains Balance in Luxury Market
With so many other markets in the nation facing issues with an imbalance of buyers to available homes, Newport Beach is one community that is experiencing surprisingly balanced conditions. According to Altos Research, a California-based real estate analytics company, the buyer-home balance is right on point which makes for a great market for both the buyer and seller.
Altos measures the equilibrium of a market through the Market Action Index, which is a scale that uses 30 as a neutral value. All values above 30 indicate a seller favor while all values below 30 indicate a buyer favor. With a current MAI of 30.95, Newport Beach is almost as close to neutral as a community can get. This indicates that there are about as many homes on the market as there are buyers, which is a balance that will help the market to grow healthily over the next few months.
The current median home value in Newport Beach is $2,351,915, a slight uptick from last week. Inventory is also beginning to level out after a long downward trend. There are currently about 220 properties on the market, but with spring season just around the corner this value is likely to begin its ascent any week now.
If you are interested in Newport Beach luxury homes for sale, please contact our team of property experts today.