"A powerful combination of lower mortgage rates, more inventory, rising income and higher consumer confidence is driving the sales rebound." - Lawrence Yun, NAR chief economist.
As Spring blooms across the U.S., investors are enjoying the season’s start with a swell of existing home sales.
Existing home sales jumped 11.8 percent in February from January — the largest monthly gain in four years, according to the National Association of Realtors. The median price of existing homes sold in February hit $249,500, up 3.6 percent from a year earlier, marking the 84th straight month of year-over-year gains, according to NAR.
While sales remained down 1.8 percent from February 2018, NAR said the real estate industry as a whole should be encouraged by the seasonally-adjusted annual rate of 5.51 million home sales.
“A powerful combination of lower mortgage rates, more inventory, rising income, and higher consumer confidence is driving the sales rebound,” said Lawrence Yun, NAR’s chief economist.
In addition to a boost in existing home sales, inventories are growing around the United States, according to the report. February home inventories grew to 1.63 million, an increase of 2.5 percent from January and an uptick of 3.2 percent since February 2018.
“It is very welcoming to see more inventory showing up in the market,” Yun said. “Consumer foot traffic consequently is rising as measured by the opening rate of SentriLock key boxes.”
Homes that sold in February were on the market for an average of 44 days, an increase from 37 days in February 2018. While a slower average rate, 41 percent of homes sold in February were on the market for less than a month.
New home buyers appear to be helping boost sales figures. First-time buyers accounted for 32 percent of existing-home sales in February, which is an increase from 29 percent in February 2018.
As low mortgage rates hold steady and inventories grow, analysts expect Spring to continue its positive momentum. A 30-year fixed-rate mortgage decreased to 4.37 percent in February from 4.46 percent in January, according to Freddie Mac.
May is almost always the best time of year to list a home, according to a recent report. Data indicate that not only do homes sell faster in May, but they on average sell for $1,600 more than the average listing throughout the year, according to Zillow,