After all the news about the difficulties in the housing market, not many expected the home sales for July to rise, but they did. According to the Commerce Department report published this Friday; new single family home sales rose 2.7% in July after two months of declines. Apparently, it is still possible to be approved for a home mortgage these days.
Even analyst were expecting a decline in new home sales but the numbers showed that the expectancy is now for home buyers to buy 870,000 new homes this year. Even the numbers published for the month of June were revised and set higher than what was initially reported.
After weeks of bad news coming from the mortgage industry where many lenders are collapsing as a result of bad credit loaners not being able to repay their loans, the market was relived and stocks closed higher. Everyone is now waiting to see if the wave declines is over but it is more reasonable to expect it to take a few more weeks.
The Commerce Department Survey report doesn’t provide information on how these new homes were purchased such as which kind of mortgage was used, nor does it provide information on credit status of the buyer. Bad credit loans have been main cause of the problems for lenders in the past few months.