US sales of existing homes unexpectedly rise to a year-long high on Bloomberg

©Bloomberg. A real estate agent shows potential homebuyers the backyard of a home for sale in Dunlap, Illinois. (Bloomberg) — Previously-owned home sales unexpectedly rose to a year-long high as buyers raced for a hike in mortgage rates, further draining tight inventories to historic lows. The number of contract signings rose 6.7% in January from the previous month to 6.5 million year-on-year, figures from the National Association of Realtors showed Friday. All four regions posted gains on a monthly basis. The median forecast in a Bloomberg survey of economists called for an annual interest rate of 6.1 million in January. “Buyers likely anticipated further rate hikes and held onto low rates, and investors contributed to overall demand with cash offerings,” NAR chief economist Lawrence Yun said in a statement Friday. “As a result, house prices continue to rise sharply.” With US housing demand still outpacing supply, the current pace of sales depends in large part on housing availability. The surge in sales in January came almost entirely from homes priced above $500,000, and the recent spike in mortgage rates may dampen future demand. The number of homes for sale fell to a record level of 860,000 last month, down 2.3% from a month earlier and 16.5% lower than a year ago. At the current rate, it would take 1.6 months to sell all homes on the market, also an all-time low in NAR’s data. Brokers see anything under five months of supply as a sign of a tight market. Amid limited supply, affordability remains a persistent problem for Americans looking to buy. The median selling price rose 15.4% to $350,300 in January compared to a year ago. First-time buyers accounted for 27% of sales in January and hovered around a record low. Cash sales accounted for 27% of all transactions last month and investors made up 22% of the market, crowding out new buyers. Builders are rushing to build more homes, but high commodity prices, shipping delays and labor shortages have exacerbated backlogs and curtailed construction activity. Digging DeeperProperties spent an average of 19 days in the market last month, compared to 21 days a year earlier. Sales of existing apartments and co-op up 8.8% Sales of previously owned single-family homes were up 6.5% from the previous month, while those prices were up 15.9% from a year ago Existing home sales account for about 90% of US homes and are calculated when a contract is signed. New home sales, which make up the rest, are based on contract signing and January data to be released next week (image added). ©2022 Bloomberg LP Disclaimer: Fusion Media would like to remind you that the data on this website is not necessarily real-time or accurate. All CFDs (Stocks, Indices, Futures) and Forex prices are not provided by exchanges but rather by market makers, and therefore prices may not be accurate and may differ from the actual market price meaning prices are indicative and not suitable for trading purposes . Therefore, Fusion Media does not bear any responsibility for any trading losses that you may incur as a result of using this data. Fusion Media or anyone associated with Fusion Media accepts no liability for any loss or damage resulting from reliance on any information, including data, quotes, charts and buy/sell signals on this website. Be fully informed about the risks and costs associated with trading the financial markets, it is one of the riskiest forms of investment possible.

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