U.S. home sales surged the most in nearly 15 years last month, while median prices hit an all-time high and sale times narrowed as housing continues to pace the nation’s economic recovery.
Existing home sales rose 2.4% from last month to a unit rate of 6 million, the third consecutive month of gains and the highest pace of gains since 2006, according to data published Tuesday by the National Association of Realtors. Sales as a whole rose 10.5% from last year, the NAR said.
The median price of house sales also increased, rising 11.4% from the same period last year to a record high of $310,600, marking 102 consecutive year-over-year gains for the monthly data as demand for larger-area living spaces outside of traditional urban centers continues to increase.
Inventory for sale is also fairly constrained, at just 2.8 months’ supply, with the NAR noting that total housing inventory at the end of August totaled 1.49 million units, down 0.7% from July and down 18.6% from one year ago.
“Home sales continue to amaze, and there are plenty of buyers in the pipeline ready to enter the market,” said Lawrence Yun, the NAR’s chief economist. “Further gains in sales are likely for the remainder of the year, with mortgage rates hovering around 3% and with continued job recovery.”
Housing has remained one of the few consistent bright spots for an American economy hit by a wave of unemployment, and slower consumer spending, brought on by the coronavirus pandemic.
However, decisive action from the Federal Reserve, in the form of record-low interest rates and the purchase of billions worth of mortgage-backed securities, has helped keep the housing market ticking amid what many suggest could be a generation-defining change in the way people live and work in the world’s biggest economy.
U.S. 30-year mortgage rates hit a record low of 2.86% earlier this month, according to Freddie Mac data, igniting “robust purchase demand activity, which is up twenty-five percent from a year ago and has been growing at double digit rates for four consecutive months”, according to chief economist Sam Khater.