Existing–home sales came back strongly in September following a decline in August and have now risen year–over–year for 12 months in a row, according to the National Association of Realtors® (NAR). All four major regions saw sales gains in September.
Total sales of existing homes (transactions for single–family homes, townhomes, condominiums and co–ops) grew 4.7 percent to a seasonally adjusted annual rate of 5.55 million in September from a slightly downwardly revised 5.30 million in August, and are now 8.8 percent above a year ago (5.10 million).
NAR’s chief economist, Lawrence Yun, believes a slight moderation in home prices in some markets and mortgage rates staying below 4 percent gave more households the confidence to close on a home last month. According to Yun, “September home sales bounced back solidly after slowing in August and are now at their second highest pace since February 2007 (5.79 million).” NAR’s economist added, “While current price growth around 6 percent is still roughly double the pace of wages, affordability has slightly improved since the spring and is helping to keep demand at a strong and sustained pace.”
Key takeaways from NAR’s data
- September’s median price for existing homes (no new construction) was $221,900, or 6.1 percent higher than a year ago ($209,100). This represents 43 months of year–over–year growth.
- Total housing inventory by the end of September dropped 2.6 percent to 2.21 million existing homes, or 3.1 percent less than the inventory a year ago (2.28 million). Unsold inventory holds a 4.8–month supply at the current sales pace.
- The share of first–time buyers dropped to 29 percent of overall sales after a rise to their highest share of the year in August (32 percent).
- Freddie Mac data shows the average commitment rate for a 30–year, conventional, fixed–rate mortgage stayed below 4 percent for the second consecutive month. A year ago, the average commitment rate was 4.16 percent.
- Properties remained on the market 49 days in September, a bump from 47 days in August and 56 days a year ago. Short sales sold in 135 days in September; foreclosures sold in 57 days while non–distressed homes required 48 days.
- Distressed sales — short sales and foreclosures — stayed at 7 percent in September for a third month in a row; a year ago, they were at 10 percent. Six percent of September sales were foreclosures and 1 percent (lowest since NAR began tracking in October 2008) were short sales.