In last week's report "Existing Home Sales Report" from National Association of Realtors (NAR) shows sales fell by 3.7% compared to the previous month. This is the second month in a row that sales have fallen. Some see this as evidence that the booming real estate market may be cooling.

However, there may also be a simple explanation as to why sales of existing homes have fallen - there aren't enough houses to buy.

There are currently 410.000 fewer houses (single families) available for sale than there were at this time last year.

Lawrence Yun, chief economist of the NAR, explains in the report:

"March sales would have been substantially higher if there had been more stock. The days of homes available on the market are fast, multiple offers prevail and buyer confidence is increasing."

Yun's vision was confirmed the next day when the Census Bureau released its Monthly Report on New Residential Sales. This shows that sales of newly built homes increased by 20.7% compared to the previous month.

Buyer demand remains strong. With more of the adult population being vaccinated and job creation data showing encouraging signs, the stock of existing homes should grow in the coming months.

What will this mean for home sales going forward?

Fannie Mae, Freddie Macand Mortgage Bankers Association (MBA) have predicted that total home sales (existing homes and new construction) will continue to rise this year and next. Here is a graph showing these projections:

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Even with the increases, the updated projections still don't reach the valuation levels above 10% of 2020.

However, a jump in the average projection from 5.3% to 7.7% after just one quarter is substantial. The demand will remain strong, therefore, future appreciation will be determined by how quickly the stock of houses for sale increases.

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[mpc_alert font_color="#ffffff" background_color="#2eabbf" padding_divider="true" padding_css="padding-left:20px;"]House Price Expectations Survey: Click Here To Read[/mpc_alert]


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Any doubts?

Now that you've understood that the market is very hot and will continue to be under pressure, this can generate gains for those who invest. We can help you understand the behavior of the real estate market so that you can consider investing in vacation homes in Orlando. To take advantage of all the tips we've given you and go even deeper, you can talk directly to our relationship agents. They are always happy to talk to you to answer any questions you may have about investing in Florida.

In this article we cover Disney's secrets for keeping mosquitoes away from the parks in Orlando. If you want to read more content like what we've covered in this article, just stay tuned here on our blog.

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