The lower cost of mortgages is fueling sales of existing homes according to the National Association of Realtors’ latest stats.
Existing sales in August gained 1.3% from July to a seasonally adjusted annual rate of 5.49 million, 2.6% higher than a year earlier. Sales were higher in the Northeast, South, and Midwest but lower in the West.
"As expected, buyers are finding it hard to resist the current rates," said NAR chief economist Lawrence Yun. "The desire to take advantage of these promising conditions is leading more buyers to the market."
Home prices continue to rise with the national median of $278,200 a rise of 4.7% year-over-year and marking the 90th straight month of gains.
And upward price pressure is helped by decreasing inventory which totaled 1.86 million at the end of August, down from 1.90 million existing-homes available for sale in July and marking a 2.6% decrease from 1.91 million one year ago.
That means there is 4.1 months of supply at the current sales pace, down from 4.2 months in July and from the 4.3-month figure recorded in August 2018.
"Sales are up, but inventory numbers remain low and are thereby pushing up home prices," said Yun. "Home builders need to ramp up new housing, as the failure to increase construction will put home prices in danger of increasing at a faster pace than income."
August existing-home sales in the Northeast increased 7.6% to an annual rate of 710,000, a 1.4% rise from a year ago. The median price in the Northeast was $303,500, down 0.3% from August 2018.
In the Midwest, existing-home sales grew 3.1% to an annual rate of 1.31 million, which is a 2.3% increase from August 2018. The median price in the Midwest was $220,000, a 6.6% jump from a year ago.
Existing-home sales in the South increased 0.9% to an annual rate of 2.33 million in August, up 3.6% from a year ago. The median price in the South was $240,300, up 5.4% from one year ago.
Existing-home sales in the West declined 3.4% to an annual rate of 1.14 million in August, 1.8% above a year ago. The median price in the West was $415,900, up 5.7% from August 2018.
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