In the Memphis, TN market in June, new home closings fell year-over-year, and the percentage drop that was steeper than May 2016 gave implications of worsening market conditions. New home closings saw a drop of 28.9% from the year earlier to 69. This was after the housing market saw a 3.4% drop year-over-year in May.
A total of 1,075 new homes were sold during the 12 months that ended in June, down from 1,103 for the year that ended in May.
New home closings made up 3.3% of overall housing closings. This is a fall 4.4% of closings a year earlier. For new and existing homes, closings sank in June after also declining in May year-over-year.
Pricing and Mortgage Trends
In June, there was a 17.9% hike year-over-year in the average price of newly sold homes, reaching $290,793 per unit. This bump is an improvement over the 6.0% boost in May year-over-year.
Average mortgage size on new homes climbed year-over-year along with new home prices. In June 2016, the average mortgage size was $262,209, a 17.6% hike from a year earlier. In May 2016, average mortgage size on newly sold homes saw a 2.3% surge year-over-year from a year earlier.
Other Market Trends
Closings of attached units, as a percentage of new home closings, have climbed from last year while closings of single-family homes have dipped. The share of new home closings belonging to attached units jumped from 4.1% of closings in June 2015 to 15.9% of closings in June 2016. At the same time, the share belonging to single-family homes dropped to 84.1% of closings from 95.9% of closings.
The average unit size of newly sold homes slid 13.1% year-over-year to 2,338 square feet in June 2016. This decline was opposite the price lift, a pattern also seen in May 2016 when the average size of newly sold homes fell 13.8% to 2,255 square feet. In May, the average size of new homes sold went from 2,616 square feet a year earlier to 2,255 square feet.
Foreclosures and real estate owned (REO) closings fell in June from a year earlier, but stayed a drag on the market. Out of all existing home closings, foreclosures combined with REO closings accounted for 27.7% of closings, below 32.0% a year earlier. The percentage of existing home closings involving foreclosures slid to 13.1% in June from 15.3% a year earlier while REO closings as a percentage of existing home closings sank to 14.6% from 16.7% a year earlier.