Existing home sales recently rose for the first time in nearly a year in the United States, according to the National Association of Realtors. The 3.6% increase from January to February signals perhaps an improvement in the residential real estate market.
The activity can be attributed to the renewed confidence in the housing market stemming from a better job market and income growth, although the current mortgage interest rate remains high in comparison to earlier this year. NAR Chief Economist Lawrence Yun suggested that the market could develop further if the rate drops to 4.5-4.7% over the summer.
The increase was seen across the country, with strong sales in the Midwest, South, and Northeast. The West was the only region to show decreased sales. In February, the West had the highest median price of any region at $408,000, a 6.6% increase from the previous year. The Northeast’s median was second highest at $293,200, representing an 8.6% increase year-over-year.
Inventory levels also saw a slight increase in February by 1%, albeit still showing a 4.3-month supply of homes. Supply has consistently been a challenge over the last year due to millennials entering the market and continued need for construction of housing, causing some buyers to have less inventory to choose from.
Overall, the increase in existing home sales may signal a potential recovery for the residential real estate market. High mortgage interest rates, however, may remain a challenge for the sector. The increase in home prices suggest that there is an increase in consumer confidence, but inventory issues remain.
You can read this full article at: https://www.housingwire.com/articles/existing-home-sales-rise-for-the-first-time-in-a-year/(subscription required)
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