New report finds national existing-home sales increasing for the second consecutive month.
Carrying the momentum picked up in April, national existing-home sales continued rising strongly in May, according to a report from the National Association of Realtors.
The total tally, which includes completed transactions for single-family homes, townhomes, condominiums and co-ops, climbed nearly five percent last month, bringing the seasonally adjusted rate to 4.89 million. While the increase fails to match the number of sales posted exactly one year prior, NAR did report a considerable gain of approximately 250,000 month-to-month.
The big story coming out of NAR’s report is May’s jump in existing-home sales. However, the report goes on to cover several trends currently affecting the industry, such as:
- Total housing inventory in May climbed just over two percent to 2.28 million existing homes available for sale, representing a 5.6-month supply considering the current sales rate – a slight decrease since April.
- Median existing-home price in May was $213,400, up 5.1 percent since May 2013.
- Single-family home sales increased by 5.7 percent, bringing the seasonally adjusted annual rate to 4.30 million, up approximately 250,000.
- Unsold inventory is up six percent since last April.
First-Time Buyers Benefit
The implications of existing-home sales performance in May appear to be largely positive. NAR Chief Economist Lawrence Yun, who describes the gains as a rebound from a “lackluster” first-quarter, attributes the increases to a myriad of contributing factors.
“Home buyers are benefiting from slower price growth due to the much-needed, rising inventory levels seen since the beginning of the year,” he says. “Moreover, sales were helped by the improving job market and the temporary but slight decline in mortgage rates.”
Steve Brown, NAR’s president and co-owner of the Ohio-based Irongate Realtors, pointed out that while the gains are a boon to the industry as a whole, perhaps no buyer will feel the benefits more prominently than those purchasing their first home – particularly if they’ve had to hold off on account of the market.
“Many potential buyers were left on the sidelines…last summer as affordability declined amidst rising home prices and interest rates,” he says. “The temporary pause in rising interest rates and more homes for sale is good news – especially for first-time home buyers.”
Yun added that new construction, while gaining, is still needed to finish balancing out the market.