Galvestonbuilders.org

During the last week of May, the Galveston's existing home sales came in UP 19.2% over a year ago. This drop was beating expectations three months in a row, monthly sales fell short of the gain expected, off 2.2%. But the months’ supply of existing homes dropped from 8.4 to 8.3 months, as inventory slid to 3.89 million homes. And the median price is rebounding, UP 2.7% over last year. Finally, the April FHFA home price index was UP 0.8% for homes financed with conforming mortgages.

May existing home sales came off as disappointing because experts predicted a sales gain after the homebuyer tax credit ended. February, March and April months saw a spike in pending home sales, which track signed contracts. Analysts now expect these gains to show up in June. Overall, home prices, mortgage rates and inventory declines continue to be encouraging signs in the housing market.

May new home sales fared worse, dropping 32.7%, to a 300,000 annual rate. This was also seen as fallout from the end of the homebuyer tax credit. But April’s 446,000 annual rate indicates the real trend is probably in between, around 375,000, which some analysts feel is enough for builders to move the homes they’re starting. Builders can also take consolation in the fact that the new homes inventory is at 213,000, its lowest level in forty years.