Sales of previously occupied U.S. homes rose in January from the previous month to the strongest pace in a year with homebuyers encouraged by a modest pullback in mortgage rates and more properties on the market.
Existing home sales climbed 9.5% last month from January to a seasonally adjusted annual rate of 4.38 million, the National Association of Realtors said Thursday. That’s the strongest sales pace since February last year and topped the 3.93 million sales pace economists were expecting, according to FactSet.
Sales rose on a monthly basis in February for the second month in a row, but fell 3.3% from a year earlier.
The pickup in sales helped push up home prices compared with a year earlier for the eighth month in a row. The national median sales price climbed 5.7% from a year earlier to $384,500. That’s the highest median sales price for February on records going back to 1999.
While the supply of homes on the market remains below the historical average, the typical increase in homes for sale that happens ahead of the spring homebuying season gave homebuyers a wider selection of properties to choose from.
At the end of last month, there were 1.07 million unsold homes on the market, a 5.9% increase from January and up 10.3% from a year earlier. That’s the highest inventory of homes for sale for February since 2020, the NAR said.
Even so, the available inventory at the end of last month amounted to a 2.9-month supply, going by the current sales pace. That’s down from a 3-month supply in January, but up from a 2.6-month pace in February last year. In a more balanced market between buyers and sellers, there is a 4- to 6-month supply.
“Additional housing supply is helping to satisfy market demand,” said Lawrence Yun, the NAR’s chief economist.
In Western states, existing-home sales rose 16.4% in a month to an annual rate of 850,000 – but that’s still a decline of 1.2% from a year earlier. The West;s median price was $593,000, up 9.1% from February 2023.
2024 economic forecasts
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US Realtors: Housing rebound from 2023’s dismal sales
California Realtors: Rising prices, sales in 2024
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