Rise in Home Inventory
Continues to Hurt Prices
By JAMES R. HAGERTY
June 6, 2007
Growing inventories of unsold homes continue to weigh on the U.S. housing market, portending more downward pressure on prices, the latest data show.
The number of homes listed for sale in 18 major U.S. metropolitan areas at the end of May was up 5.1% from April, according to figures compiled by ZipRealty Inc., a national real-estate brokerage firm based in Emeryville, Calif. The data cover all listings of single-family homes, condos and town houses on local multiple-listing services in those areas.
The sizable increase is notable because, on a national basis, inventories of listed homes have typically been little changed in May during the past two decades, according to Credit Suisse Group. May is one of the peak home-selling months because families with children often aim to move during the summer vacation.
Some of the biggest inventory increases last month came in the metro areas of Seattle, up 12% from April; San Francisco, 11%; Los Angeles, 10%; and Washington, D.C., 9%.
Inventories also are up sharply from a year earlier. For the 15 cities for which year-earlier comparisons were available, combined inventory was up 29% from May 2006.
The housing market has been cooling for the past two years after a buying frenzy in the first half of the decade. Prices have flattened or declined moderately in much of the country. A tightening of lending standards has put more downward pressure on the market by making it harder, if not impossible, for some potential buyers to get credit. Meanwhile, rising foreclosures are dumping more homes on the market.
Last week, the National Association of Realtors said its index of pending home sales in April declined 3.2% from March and was down 10% from April 2006. Sales are considered pending when the buyer and seller have agreed on terms but the transaction hasn't been completed.
Continues to Hurt Prices
By JAMES R. HAGERTY
June 6, 2007
Growing inventories of unsold homes continue to weigh on the U.S. housing market, portending more downward pressure on prices, the latest data show.
The number of homes listed for sale in 18 major U.S. metropolitan areas at the end of May was up 5.1% from April, according to figures compiled by ZipRealty Inc., a national real-estate brokerage firm based in Emeryville, Calif. The data cover all listings of single-family homes, condos and town houses on local multiple-listing services in those areas.
The sizable increase is notable because, on a national basis, inventories of listed homes have typically been little changed in May during the past two decades, according to Credit Suisse Group. May is one of the peak home-selling months because families with children often aim to move during the summer vacation.
Some of the biggest inventory increases last month came in the metro areas of Seattle, up 12% from April; San Francisco, 11%; Los Angeles, 10%; and Washington, D.C., 9%.
Inventories also are up sharply from a year earlier. For the 15 cities for which year-earlier comparisons were available, combined inventory was up 29% from May 2006.
The housing market has been cooling for the past two years after a buying frenzy in the first half of the decade. Prices have flattened or declined moderately in much of the country. A tightening of lending standards has put more downward pressure on the market by making it harder, if not impossible, for some potential buyers to get credit. Meanwhile, rising foreclosures are dumping more homes on the market.
Last week, the National Association of Realtors said its index of pending home sales in April declined 3.2% from March and was down 10% from April 2006. Sales are considered pending when the buyer and seller have agreed on terms but the transaction hasn't been completed.
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