In the Merced, CA market, closings of new homes increased year-over-year in June, and the percentage lift, which was better than May 2016, suggested the market may be improving. There was a more than twofold jump in new home closings from a year earlier. This was after the housing market saw a 39.1% boost year-over-year in May.
A total of 294 new homes were sold during the 12 months that ended in June, up from 277 for the year that ended in May.
Of 303 total closings, 32 were of new homes. This is better than the 5.3% of closings a year earlier. Closings of new and existing homes gained year-over-year in June following a drop in May year-over-year.
Pricing and Mortgage Trends
In June, the average price of newly sold homes grew 11.3% year-over-year to $308,831 per unit. This hike is better than the 5.7% surge in May year-over-year.
There was a boost year-over-year in the average mortgage size on new homes along with new home prices. In June 2016, the average mortgage size was $267,067, a 7.5% bump from a year earlier. In May 2016, average mortgage size gained 7.5% from a year earlier.
Other Market Trends
There was no change in the composition of the new home market with regard to the types of properties sold in June 2016. Single-family home closings have represented all of new home closings while attached unit closings have accounted for no part of closings.
Foreclosures and real estate owned (REO) closings continued to fall from a year earlier in June, but did not appear to be dragging the market. Combined, foreclosures plus REO closings accounted for 15.1% of existing home closings, below 18.0% a year earlier. The percentage of existing home closings involving foreclosures declined to 5.2% in June from 7.5% a year earlier and REO closings moved from 10.5% of existing home closings in June 2015 to 10.0% in June 2016.