Good afternoon —
First, a total rabbit hole on this Wednesday in July. I wanted to make a movie reference for this ed note, so I looked up the top-grossing movies of all time. Boy, was I in for a shock. First of all, "Avatar" is still No. 1?! And how did different "Avengers" take No. 2, No. 5, No. 8 and No. 11? Why is the second "Frozen" at No. 10 while the original "Frozen" is all the way down at No. 16?
And what in the name of housing is "Aquaman" doing at No. 23, above films like, well, any of them?
Ok, I'm done.
So, several recent reports seem to suggest the uber-hot housing market is slowing down to just really hot. Mortgage apps decreased from May to June by 3% and Redfin reported that 65% of home offers written by company agents in June faced competition, down from a rate of 72.1% in May.
Here's where I was going to insert a fun movie reference we would all understand, because really, we're still in a crazy hot market. But what am I going to say…the housing market went from "Avengers: Infinity War" to "Furious 7?" Or try to parse "Iron Man 3" from "Minions?" It's a lost cause.
Instead, I'll point out that data is best understood in context. Let's start with housing permits, which fell 6.3% in June. Does that mean demand is starting to cool? Maybe, but looking at starts, which increased this month, you get a different picture. Mark Palim, deputy chief economist at Fannie Mae, offered this:
"While this data tends to be noisy on a month-to-month basis, the divergence between starts and permits is consistent with builders struggling to keep up with orders, as is the tick up in homes authorized but not yet started. With lumber prices recently pulling back, we expect some near-term strength in construction. However, June's starts gain was somewhat smaller than we had anticipated while the fall in permits was greater. Therefore, a modest downward revision to our near-term forecast is likely."
Consider also home sales, which fell 1.2% from May to June, the largest drop at this time of year since 2012. But, that decrease took place while the national median home-sale price hit a record high of $386,888 nationally. So, yes, sales are down slightly, but considering we saw record high home prices, that's still a great showing. Context is key with housing data.
If only it could explain why "Madagascar 3" beat out "Interstellar."
Until tomorrow —
Sarah Wheeler
HousingWire Editor in Chief
EmoticonEmoticon