US housing market exhibits more signs of recovery

The U.S. housing market is improving bit by bit as data from a first-ever Residential Sales report from RealtyTrac shows, a company executive said. "The U.S. housing market is slowly but surely moving toward a more normalized and sustainable pattern after a flurry of institutional and cash buyers flocked to residential real estate last year," Daren Blomquist, vice president at RealtyTrac, said in a statement. Institutional buyers, measured by the number of sales to non-lending entities that purchased at least 10 properties in the last 12 months, rose to 9 percent of all residential sales in June, up from 8 percent in May, but down from 10 percent in June 2012, the firm said. Institutional buying pushes up prices quickly and often snatches up the best inventory available in a local market, Blomquist said. In turn, as prices go up, institutional investors fade back into the woodwork. "Rising home values should continue to unlock more non-distressed inventory while also pricing institutional investors out of more markets, which, combined with rising interest rates, will cool off the pace of price appreciation," Blomquist said. The Residential Sales Report showed other signs of a market in recovery. The report found the national median sales price in June was $168,000, up 3 percent from May and up 5 percent from June 2012. The median price for distressed homes -- homes in foreclosed or bank-owned -- was $120,000, while the median price of non-distressed homes was $181,500, RealtyTrac said. Short sales, which are sales at a price below what is owed on the mortgage, fell to 14 percent of all residential sales in June, down from 15 percent in May, but up from 8 percent in June 2012. In five western city markets the annual increase in median sales prices topped 20 percent, including Sacramento, Calif., where the median price rose 35 percent in 12 months and San Francisco, where the median price rose 30 percent. The median price rose 27 percent in Los Angeles, 26 percent in Las Vegas and 25 percent in Phoenix, the report said. But short sales, a sure sign of a wobbly market, are still occurring in significant numbers. Short sales, which are sales at a price below what is owed on the mortgage, fell to 14 percent of all residential sales in June, down from 15 percent in May, but up from 8 percent in June 2012. In June, 30 percent of all sales in Nevada were borrowers selling short. In Florida, short sales accounted for 29 percent of all sales. In Maryland, it was 21 percent and in Tennessee and Arizona, short sales made up 19 percent of the total.