According to the National Association of Realtors (NAR), existing home sales has increased for 3 consecutive months and is now on its hottest pace since December of 2006. According to the report, the amount of total existing home sales which are defined as completed transactions including single-family homes, townhomes, condominiums and co-ops, increased 5.6% from last month to 5.81 million sales in November. The sales pace represents an increase of 3.8% from year over year and the strongest pace of existing home sales since December 2006.
Lawrence Yun, chief economist for the NAR seems extremely optimistic from the report. He states “Faster economic growth in recent quarters, the booming stock market and continuous job gains are fueling substantial demand for buying a home as 2017 comes to an end. As evidenced by a subdued level of first-time buyers and increased share of cash buyers, move-up buyers with considerable down payments and those with cash made up a bulk of the sales activity last month. The odds of closing on a home are much better at the upper end of the market, where inventory conditions continue to be markedly better.”
Also of significance the median existing home price increased once again to $248,000. It is an increase of 5.8% from the same time last year. Supply remains a concern with the market and has affected both increases in home prices and sales. The report indicates inventory has dropped 7.2 percent to 1.67 million existing homes available. The amount of inventory is 9.7 percent lower than a year ago (1.85 million) and has fallen year-over-year for 30 consecutive months. There are concerns of affordability as we enter into the new year. There is speculation that mortgage interest rates will be increased leading to higher prices if inventory congestion remains.
In the Northeast the November existing-home sales increased 6.7 percent to an annual rate of 800,000. The median sales price in the Northeast was $273,600, which is 4.0 percent above November 2016.
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