The National Association of Realtors said on Thursday, July 21, existing home sales increased 1.1 percent to an annual rate of 5.57 million units last month, the highest level since February 2007. With a larger share of first-time buyers than the residential market has seen in almost four years, June’s tally reached an annualized 5.57 million, the best showing since 5.79 million in February 2007.
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Sales declined 1.3% in the Northeast, rose 3.8% in the Midwest, were unchanged in the South, and ticked up 1.7% in the West. The available inventory was at a 4.6-month supply, down from 4.7 months in May.
Economists surveyed by MarketWatch had forecast a 5.47 million rate, and April’s pace, previously reported as 5.53 million, was revised down fractionally to 5.51 million.
Yun said that the pace of sales may not be sustainable given a shortage of homes for sale and rising home prices.
“Though June’s existing home sales numbers show that we’re about 95% back to the pre-recession average, there are many more households in the USA looking for homes than in the early 2000s”, Trulia Chief Economist Ralph McLaughlin said.
Sales of previously owned homes rose to their strongest pace in almost a decade in June, buoyed by low mortgage rates and an improving economy.
The housing market’s biggest challenge remains tight inventory.
Sales were up 9 percent over the year in June while the median sales price – the point at which half the sales are lower or higher – rose almost 12 percent.
First-time homebuyers returned to the market in greater numbers in June. Investors made up only 11% of sales, the lowest since 2009.
“Sustained job growth as well as this year’s descent in mortgage rates is undoubtedly driving the appetite for home purchases”, he said.
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Pantheon Macroeconomics said the figures were solid, but it’s hard to see significant further gains until mortgage demand rises.
