Recovery of the housing market brings opportunities.
If you were to chart the collapse of the housing market a few years ago, the downward line you would draw would be straight, unfaltering and resolute.
Today, if you were charting the recovery, the upward line you’d draw would be wiggly, choppy, and somewhat unsure of itself.
But that’s okay. The trajectory is what matters here. We seem to be headed in the right direction, even with the choppy line.
High-end home brands have much to gain in an improving market – not only among affluent consumers, but also among middle-class consumers who are beginning to feel more confident about making select purchases of high-end brands. So I hope that you are following the economic trends closely – and that you are making preparations for your brand to participate fully when the market finally hits its stride.
Bloomberg recently reported several encouraging statistics about the U.S. housing market. (Note that these statistics are for the full market, not just the high-end.) In my opinion, each data point is unremarkable in and of itself. But taken together, they form a constellation of improving trends that I’ve not yet seen. So I am very encouraged.
Eight data points stood out to me in the report:
- Purchases of new homes rose in May by the most in 22 years.
- The median sales price of new homes increased 6.9 percent during the past year to reach $282,000.
- Purchases climbed in all four regions of the country, led by a 54.5 percent jump in the Northeast.
- Builders broke ground on homes at a 1 million annualized pace in May following 1.07 million in April, the best two-month reading since late 2013.
- Purchases of existing homes climbed 4.9 percent, the biggest increase since August 2011, to a 4.89 million annualized rate.
- Consumer confidence increased more than forecast in June to reach the highest level in more than six years.
- Builder sentiment is also rebounding. The National Association of Home Builders/Wells Fargo confidence index climbed to 49 from 45 in May, the biggest gain since July 2013.
- Overall, mortgage costs are still near historically low levels. The average 30-year, fixed-rate mortgage was 4.17 percent in the week ended June 19, down from 4.41 percent at the beginning of April.
As more new homes are built and existing homes are bought, and as more consumers get off of the sidelines and into the game, are you ready to take full advantage of the housing market recovery?
Here is the link to the full Bloomberg story.