Bigger. Better. Bolder. Inman Connect is heading to San Diego. Join thousands of real estate pros, connect with the Inman Community and gain insights from hundreds of leading minds shaping the industry. If you’re ready to grow your business and invest in yourself, this is where you need to be. Go BIG in San Diego!
Existing-home sales made a comeback in February, signaling renewed momentum in the housing market, according to the National Association of Realtors (NAR).
As buyers cautiously reentered the market, existing-home sales rose 4.2 percent from January to 4.26 million. However, compared to last year, sales remained down by 1.2 percent.
TAKE THE INMAN INTEL INDEX SURVEY FOR MARCH
NAR Chief Economist Lawrence Yun attributes the uptick to seasonal adjustments and an increase in available inventory, which has encouraged more buyers to take action.
Lawrence Yun | NAR Chief Economist
“Homebuyers are slowly entering the market,” Yun said in a statement. “Mortgage rates have not changed much, but more inventory and choices are releasing pent-up housing demand.”
By the end of February, housing inventory reached 1.24 million units, while the 30-year-fixed-rate mortgage averaged 6.65 percent as of March 13, according to Freddie Mac.
The share of first-time homebuyers made up 31 percent of February’s sales. On an annual basis, first time buyers accounted for only 24 percent — the lowest ever recorded. Meanwhile, individual investors or second-home buyers comprised 16 percent of purchases.
The housing market continued to see price appreciation across all four U.S. regions, while regional sales were more sporadic.
Regional Sales:
- Northeast: Sales fell 2.0 percent from January to 500,000. The median price jumped 10.4 percent to $464,300.
- South: Sales rose 4.4 percent from January to 1.91 million. The median price increased 1.9 percent to $358,800.
- West: Sales jumped 13.3 percent to 850,000. The median price rose 3.6 percent to $614,600.
- Midwest: Sales remained flat at 1 million. The median price increased 5.8 percent to $295,500.
The median existing-home price in February climbed to $398,400, a 3.8 percent increase from the previous year.
Despite lingering affordability challenges, Yun noted that rising home prices are boosting household wealth.
“Each one percentage point gain in home price translates into an approximately $350 billion increase in housing equity for American property owners,” Yun said. “That means a gain of nearly $1.3 trillion in home value appreciation at a time when the current stock market is undergoing a correction. Moreover, the ongoing housing shortage, coupled with historically low mortgage default rates, implies solid foundation for home values.”
