Today’s housing news/what we’re reading
Though new home sales across the country fell a startlingly 8.4 percent during June, according to the U.S. Department of Commerce, economists at Wells Fargo Securities say that the housing recovery is still intact. That’s because sales of new houses during the first six months of the year are still almost 19 percent higher than last year.
Also, inventories of unsold new homes remain healthy at a 4.9 month supply, which means that at the current sales pace it would take 4.9 months to wipe out the inventory of new homes nationwide. The folks at Wells say that the June dip is just another reminder that the housing recovery is going to be uneven from month-to-month, and it’s going to be slow.
Here’s what’s happening locally: Construction activity in the Twin Cities continues to build. Thursday afternoon the Builders Association of the Twin Cities said that builders were issued 403 permits to build 783 units during the four full weeks of July. That was 110 percent increase in the number of permits compared with last year and a 72 percent increase in units.
Sounds like a construction boom, right? Well, 350 of those units are in two large multi-family projects, including 230 units in Ramsey and 122 units in St. Louis Park. As we reported in the Thursday paper (click here to read the story), the rental market has been extremely robust as developers race to meet growing demand for apartments. New home sales have helped lift construction of for-sale housing, as well. The number of new single-family houses planned for the metro was up 60 percent compared with last year.
The report is consistent with what’s been happening over the past several months. So far this year there 2,239 permits were issued to build 3,953 units.
A new record for mortgage rates: Mortgage interest rates dipped to another all-time low on Thursday. That’s according to Freddie Mac’s latest weekly survey, which showed the average 30-year fixed-rate mortgage dipped to 3.49 percent.