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And again -- -- existing home sales rising in April to their highest level in nearly two years in my next guest says it's -- -- the housing market is beginning to stabilize.
Joining me now is DV six mister chief economist -- is the chief economist they're great to have you on the show -- What but aren't.
Why don't we get to to nice bump in existing home sales megas the bigger question is will continue -- we got an upward trajectory now.
We're definitely on an upward trajectory we start to see the housing market stabilize last fall.
We've had a series a good existing home sales reports including the one that we have this morning.
Existing home sales have been rising about 50000 units per month.
We're getting close to getting back to where we were part of a bubble when we -- about five point two million homes being sold.
Per year or -- four point six so we're just 700000 sort of reaching five point two million.
So why I guess that's the 64000 dollar question right are we finally after 56 years of being in the doldrums starting to see life -- the housing market.
Well you know I think there's three primary reasons one we're seeing some improvement in the job market since September of job growth has been averaging about 200000 per month.
We're starting to see foreclosures weigh less heavily -- on the market.
So we have fewer.
-- going into default we have -- shifting away form for closing on properties and using more short sales to deal with underwater mortgages.
And then we're seeing very strong demand from investors for foreclosed properties but I think the primary reason is -- affordability.
Home prices are very -- right now relative to rents were back to 1998 levels.
Relative to income we're back to 1991 levels.
And if you factor in record low mortgage rates the ratio of monthly mortgage payment to median family income is lower than it's been in forty years so -- -- -- was.
Are people finally jumping -- and taking advantage of these record low mortgage rates because it took I'm allowed to do that.
Yet we're starting to see people jump back into the market and in particular we're seeing strong demand from investors.
In some of the former bubble craft markets like Phoenix and Florida.
Where investors are taking advantage of low prices and economic -- -- -- a low interest rates.
To try to catch prices that a bottom -- -- you know starting to see.
I'm sorry to catch a -- finish a statement.
And we're also starting to see increasing demand for first time buyers so as the labor market improves first time buyers are gaining more confidence and they're also starting to move into the mark.
So David one quick last thing you know it's not a straight line across the board there are certain regions that are clearly doing better in the housing market than others.
So where the weak spots in what's depressing though serious are they indeed are are they unique problems or is it.
Just a matter of that the broader.
Improvement just trickling down to you know states like Florida Nevada.
Well I think there's certain markets where there are still large overhang of foreclosed properties so even though their importance within that market is diminishing.
They still have to be worked off some markets like Las Vegas many of the Florida markets we'll continue to price declines throughout the year as those in mentors were liquidated.
But eventually we expect fairly substantial price increases even in those -- markets are interesting perspective David --
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