Both new home sales and housing inventory continued to fall in June, says Bank Leumi in its weekly macroeconomic report. "It is premature to saw whether the fairly low level of homes sales in June (13,300 apartments in seasonally adjusted figures) is a change in trend, given that home sales in May were unusually high, at 17,700 apartments, and were even revised upwards last month," says the bank.
The housing inventory in June was sufficient for 7.9 months, in trend figures. Bank Leumi notes, however, that a breakdown of inventory by region, using original figures (not trend figures), shows that the housing inventory is sufficient for 5-7 months in the Central, Haifa, and northern districts, down from an 8-14 months supply two years ago.
Bank Leumi says that these figures reflect the high housing demand in these districts, which is accompanied by a sharp rise in prices. The slow increase in supply is insufficient to meet the rapid increase in demand, driven in part by the low prevailing interest rate.
Published by Globes [online], Israel business news - www.globes-online.com - on August 5, 2010
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