US Existing Home Sales Increase 7%, Highest in a Year | Business
Sales of former owners’ homes in the United States rose the most in September in a year, suggesting a slight slowdown in home price growth and lower mortgage rates a month earlier provided a positive wind on demand.
Contract closings were up 7% from the previous month, the highest since September 2020, to reach 6.29 million on an annualized basis, figures from the National Association of Realtors showed Thursday. The median forecast of a Bloomberg poll of economists predicted a gain of 3.7%.
“Some improvement in supply over the previous months helped boost sales in September,” Lawrence Yun, chief economist of NAR, said in a statement. “Housing demand remains strong as buyers are likely to want a home before mortgage rates rise even further next year.”
Buyer demand, while cooling since late 2020 due to a limited supply of affordable housing on the market, remains firm. Last month’s annualized pace was the strongest since January and above the Bloomberg survey’s median estimate of 6.1 million.
The median selling price of an existing home rose 13.3% in September from a year ago to $ 352,800. This is the smallest annual price increase since the end of 2020.
Available homes are soaring from the market, underscoring the strength of demand from buyers. Properties were on the market for an average of 17 days last month, up from 21 days a year ago. Eighty-six percent of homes sold in September had been on the market for less than a month.
There were 1.27 million homes for sale last month, down 13% from a year ago. At the current rate, it would take 2.4 months to sell all homes on the market, compared to an average of around 4 months before the pandemic. Real estate agents see anything under five months of supply as a sign of a tight market.
The high prices have made the dream of buying a house even more unattainable for many. Compared to a year earlier, sales are increasing at the high end of the market, while purchases of properties listed under $ 250,000 are down.
The share of first-time buyers fell last month to 28%. And in the future, housing affordability is unlikely to improve. While borrowing costs were cheaper in August, the contract rate on a 30-year mortgage rose last week to a six-month high, according to the Mortgage Bankers Association.
—Sales of previously owned single-family homes soared 7.7% last month to 5.59 million
—Sales of existing condominiums and co-ops increased 1.4% in September to 700,000
—Contract closings increased in all regions, driven by an 8.6% jump in the South. Sales also climbed 6.5% in the West and 5.1% in the Midwest.
—Existing home sales represent approximately 90% of homes in the United States and are calculated at the close of a contract. New home sales, which make up the rest, are based on contract signatures and will be released on Tuesday
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