Existing Home Sales - Jul Report
Last Updated: 8/14/2015
Home Sales Pace
Sales of existing U.S. homes rose in June to an eight-year high, spurred on by rising interest rates and higher demand, according to the National Association of Realtors.
Total existing-home sales grew to a seasonally adjusted annual rate of 5.49 million homes, the highest level since February 2007, up 3.2 percent from the 5.32 million in May. Sales rose 9.6 percent from the previous year.
"Buyers have come back in force, leading to the strongest past two months in sales since early 2007," said NAR chief economist Lawrence Yun. "This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy. The sales were also likely propelled by the spring's initial phase of rising mortgage rates, which usually prods some prospective buyers to buy now rather than wait until later when borrowing costs could be higher."
The median existing-home price jumped to $236,400 in June, up from $228,900 in May, and up 6.5 percent from June 2014. Prices have risen on a year-over-year basis for the past 40 straight months. The median sales price has now topped the housing bubble peak median of $230,400 in July 2006.
The NAR defines existing homes as all previously-owned single-family homes, townhouses, condominiums, and co-ops. The group “seasonally adjusts” the sales numbers to factor in things like inclement weather, school sessions, winter holidays, etc. to smooth out the trends.
The NAR also describes its sales data based on an annual pace. The monthly figure represents the total number of housing units that would be sold in one year if the current rate were to continue unchanged.
Sales Pace by Region
Sales rose in every region of the country, with the strongest gains in the Northeast and Midwest. The Northeast saw sales grow 4.3 percent in June to an annual pace of 720,000, up from 690,000 in May and up 12.5 percent from the previous year. In the Midwest, total sales increased to $1.33 million homes, up 4.7 percent from 1.27 million the month before and up 12.7 percent from June 2014. Sales in the South rose to annual rate of 2.20 million in June, up 2.3 percent from 2.15 million in May. Sales were also up 7.3 percent from one year earlier. And in the West, sales increased to an annual level of 1.24 million, up 2.5 percent from May’s 1.21 million. Compared with last year, sales in the West are up 8.8 percent.
Sales Price by Region
Median prices also rose across the nation in June. In the Northeast, the median price grew to $281,200, up from $269,000 in May. The price is up 3.9 percent from the year before. The Midwest median price rose to $190,000, up from May’s $181,300 and up 7.2 percent from June 2014. The South experienced a price increase to $205,000, up from $199,700 the month before and up 7.2 percent from the previous year. In the West, the median price jumped to $328,900, up from $322,100 in May and up 9.9 percent from a year ago.
Inventory increased just slightly in June, rising 0.9 percent to 2.30 million existing properties for sale, a 0.74 percent increase from the year before. At the current sales pace, there is a 5.0-month supply of homes, down from 5.1- months in May. Realtors consider the market to be balanced between buyers and sellers when there is a six-month supply available.
Data for August existing-home sales, prices, and inventory will be available at the end of September.