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Existing-home sales see rise for first time in months; NAFCU expects sales to remain strong
Existing-home sales rose 1.4 percent in June to a seasonally-adjusted rate of 5.86 million units, representing a 22.9 percent increase in sales versus a year ago. NAFCU's Curt Long analyzed the data in a new Macro Data Flash report.
"Median price rose to a new all-time high as demand continues to force prices upwards,” said Long, NAFCU's chief economist and vice president of research. "Mortgage rates have been heading lower, boosting demand and remaining only 23 basis points higher than the all-time low set in January.
"Demand is ebbing somewhat from its frenzied levels of earlier this year, but that is only encouraging buyers who sat out the rush to re-enter the market," added Long. "On the supply side, housing starts rose 6.3 percent in June while permits fell 5.1 percent."
Based on current sales, there was 2.6 months of supply at the end of June, up 0.1 months from May. Analysts consider 6 months of inventory a rough balance between supply and demand.
Sales rose in three regions in June, with the Midwest seeing the largest rise (+3.1 percent), followed by the Northeast (+2.8 percent), and the West (+1.7 percent). Meanwhile, the South was flat. Versus a year ago, sales were up in all regions.
The median existing-home price rose from $350,400 in May to $363,300 in June (not seasonally-adjusted), representing a 23.4 percent increase from the median price a year ago.
"A further improving economy and raising wages will also boost sales into the medium and long term," concluded Long. "NAFCU expects sales to remain strong for the rest of the year, still limited by availability and affordability."
For more economic updates from NAFCU's award-winning research team, view all of NAFCU's Macro Data Flash reports.