May. 24, 2013Economy Watch: New Home Sales Up in April
By Dees Stribling, Contributing Editor
The Census Bureau reported on Thursday that new home sales were at an annualized rate of 454,000 units in April, up from 444,000 in March, which was revised upward from 417,000—an unusually strong revision. The bureau revised the February and January totals up significantly as well.
The month-over-month increase in U.S. home sales was 2.3 percent, while the year-over-year increase in April was a healthy 29 percent. The supply of houses for sale came in at 4.1 months last month, the same as in March. This, according to the bureau, points to strong demand—at least relative to supply, which has been persistently weak for types of housing since the onset of the recession.
“We’re in a cyclic recovery for housing after one of the sharpest downturns in history,” Resource Real Estate CEO Alan F. Feldman tells MHN. “Not nearly enough single-family and multifamily housing has been built in recent years even to keep up with population increase. We’ve been drastically undersupplied for the last five years, so there’s a lot of catching up to do. Still, there’s some risk at the higher end of multifamily that rent growth won’t be able to sustain its current momentum, because the high end is where most of the development is taking place.
This is exactly the kind of news I've been "attempting" to explain when my customers ask, why are the rents so high and why is there such demand and not enough apartments to meet the demand? Increase in occupancy equals to higher rents! Even the suburban areas of Houston, such as the Clear Lake area, Seabrook, League City, Friendswood and Kemah have experienced huge rental increases as recently as the past few months, and that is certainly the case with Inner Loop, Museum District, Galleria, anything remotely close to what's considered Urban areas!
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