Existing Homes Sales Volume in West Continue Decline, Will Home Prices Hold?

Today, the NAR released it’s existing home sales data and again the West is down in sales volume… in fact, we are down 14.4% off last year. That’s a pretty big number as indicated by the chart. To the delight of many (homeowners) home prices have remind fairly stable.

According to the charted data it would appear that the sharp volume decrease may be over and we may possibly see an increase as the peak sales months approach.

Will home prices continue to hold or will they also follow the existing home sales trend. If inventory continues to build and mortgage rates stay the same or increase, I suspect that home prices will also begin to flatten and eventually maybe even fall.

One thing that is concerning is the tightening of mortgage lending guidelines from lenders and Wall Street on the ever popular “pay option arms” as these creative mortgages have fueled the jump in prices.

What do you think will happen?

Data: NAR Existing Home Sales