As expected after the holiday season, existing-home sales increased 3.3% in January to the fastest pace in almost a decade, according to latest report from the National Association of Realtors (NAR)®. Home sales saw gains in most regions of the nation except for the Midwest.
The NAR report covers completed sales transactions of single-family homes, townhomes, condominiums and co-ops with a seasonally adjusted annual rate of 5.69 million in January from an upwardly revised 5.51 million in December 2016.
The sales pace jumped 3.8% higher than this same time last year which was aty 5.48 million and was also higher than November 2016 (5.60 million) as the strongest since February 2007 (5.79 million).
Lawrence Yun, NAR chief economist, says January’s sales gain signals resilience among consumers even in a rising interest rate environment. “Much of the country saw robust sales activity last month as strong hiring and improved consumer confidence at the end of last year appear to have sparked considerable interest in buying a home,” he said. “Market challenges remain, but the housing market is off to a prosperous start as homebuyers staved off inventory levels that are far from adequate and deteriorating affordability conditions.”
“Competition is likely to heat up even more heading into the spring for house hunters looking for homes in the lower- and mid-market price range,” added Yun. “NAR and realtor.com®’s new ongoing research — the Realtors® Affordability Distribution Curve and Score — revealed that the combination of higher rates and prices led to households in over half of all states last month being able to afford less of all active inventory on the market based on their income.”