Despite
month-to-month vacillation in U.S. housing sales, the National
Association of Realtors on Thursday said the housing industry may be
in recovery because gains in home sales in June were nationwide and
could be sustained by a recently-passed economic stimulus bill.
NAR,
one of the largest trade groups in the U.S., said that the current
growth trend could be bolstered by a tax credit now available to
first-time home buyers and a Federal law that makes it easier to
secure lower mortgages for more expensive homes.
But
there is another less-obvious factor playing into the recovery. The
easy availability of real estate data on the Internet is changing
consumer behavior patterns, according to NAR, and that had some
effect on the downturn and it is influencing the recovery.
“In
the past people would buy a new home because they had an additional
child or for some other life-changing reason, but people are now
market-timing their purchases,” said Lawrence Yun, NAR's chief
economist. “This can affect both a downturn and a recovery.”
Good
and bad news now travels much faster and farther because even homeowners who are
not planning to sell their homes are keeping tabs on both the current
value of their homes and the nationwide housing market.
“The
prevalence of housing data is making the market far more cyclical
than it used to be and the intervals are much shorter as homeowners'
activity is being governed to some extent by the news and blogs
concerning market conditions,” Mr. Yun said.
Housing
sales have been rising and falling in increasingly tighter cycles.
The data shows wide vacillation from month to month, according to
NAR, making it tougher to identify long-term trends and transitions.
“There
must always be caution when reading monthly data because of the
bouncing around, but the June increase was much larger than recent
months and given the availability of tax credits and lower interest
rates, we believe it will be sustained,” Mr Yun said.
Analyst
Greg Sterling said that online real estate firms are having only
a marginal effect on the economics of the industry, perhaps
accelerating consumer trends, but the major trends are still being
governed by demand and supply.
“The
data available online may factor into consumer perceptions but the
market is moved by things like the availability of attractive
financing,” said Mr. Sterling, an analyst with Sterling Market
Intelligence. “But over time the Internet will play a bigger role
as consumer perceptions become more central to the economics of the
real estate market.”