U.S. Home Sales Boosted By Record Low Inventory
The housing market continues to benefit from low mortgage rates and inventory levels, as existing-home sales edged slightly higher last month.
On Thursday, the National Association of Realtors announced that total existing-home sales, which are completed transactions that include single-family homes, town-homes, condos, and co-ops, increased 0.4 percent to a seasonally adjusted annual rate of 4.92 million units in January. It was the second highest rate of sales since November 2009 and a 9.1 percent improvement from the 4.51 million-unit pace a year earlier.
Analysts and economists polled by Reuters and Bloomberg both expected a 4.9 million-unit pace in existing-home sales. The December rate was revised downwardly to 4.9 million units.
Tight inventory is still a major factor in the so-called housing “recovery” story. Lawrence Yun, NAR chief economist, explains, “Buyer traffic is continuing to pick up, while seller traffic is holding steady. In fact, buyer traffic is 40 percent above a year ago, so there is plenty of demand but insufficient inventory to improve sales more strongly. We’ve transitioned into a seller’s market in much of the country.”