Existing US home sales increased in May with buyers responding to lower home prices, according to the National Association of Realtors®.
Existing home sales, including single-family, townhomes, condominiums and co-ops – increased two percent to a seasonally adjusted annual rate of 4,99 million units in May from a level of 4,89 million in April, but are 15,9 percent below the 5,93 million-unit pace in May 2007.
NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said buyers are seeing value in the current housing market. “Home buyers are starting to get off the fence and into the market, drawn by drops in home prices in many areas and armed with greater access to affordable mortgages,” he said. “Today’s buyer plans to stay in a home for 10 years, which is a good strategy for building long-term wealth.”
The national median existing-home price2 for all housing types was $208 600 in May, down 6,3 percent from a year ago when the median was $222 700.
Lawrence Yun, NAR chief economist, said there’s still a lot of inventory in the market. “The large supply of homes on the market clearly favours buyers, and it should take several months to draw the inventory down,” he said. “Stabilisation in home prices can only occur with buyers returning to the market, so we are encouraged by rising home sales, particularly in distressed markets. Foreclosures and short sales appear to be a larger part of the market, particularly in California, and are creating a drag on current home prices.”
Total housing inventory at the end of May fell 1,4 percent to 4,49 million existing homes available for sale, which represents a 10,8-month supply at the current sales pace, down from a 11,2-month supply in April.