A brief drop in mortgage rates and a pullback in U.S. home prices boosted existing home sales in February, according to the National Association of Realtors (NAR). The 30-year mortgage rates averaged less than 6.3% in February per Freddie Mac and the median sales price in February posted the first decline since February 2012. The monthly increase in sales ended a 12-month streak of declines, as the National Association of Home Builders (NAHB) reports.
Total existing home sales, including single-family homes, townhomes, condominiums and co-ops, rose 14.5% to a seasonally adjusted annual rate of 4.58 million in February, the largest monthly gain since July 2020. On a year-over-year basis, sales were still 22.6% lower than a year ago.
The first-time buyer share fell to 27% in February, down from 31% last month and 29% in February 2022. The weakening of the first-time buyer share is a reminder of the pricing out the market has experienced. The February inventory level measure stayed at 0.98 million units but was up 0.85 million from a year ago.
At the current sales rate, February unsold inventory sits at a 2.6-months’ supply, down from 2.9 last month but up from a 1.7-months reading a year ago. This inventory level remains very low, compared to balanced market conditions (4.5 to 6 months’ supply), and illustrates the long-run need for more home construction.
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Homes stayed on the market for an average of 34 days in February, up from 33 days in January and 18 days in February 2022. In February, 57% of homes sold were on the market for less than a month.
The February all-cash sales share was 28% of transactions, down from 29% last month but up from 25% a year ago. All-cash buyers are less affected by changes in interest rates.
The February median sales price of all existing homes was $363,000, down 0.2% from a year ago, ending a streak of 131 consecutive month of year-over-year increases, the longest-running streak on record. The median existing condominium/co-op price of $321,000 in February was up 2.5% from a year ago.
Geographically, all four regions saw an increase in existing home sales in February, ranging from 4.0% in the Northeast to 19.4% in the West. However, on a year-over-year basis, all four regions continued to see a double-digit decline in sales, ranging from 18.7% in the Midwest to 28.3% in the West.
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The Pending Home Sales Index (PHSI) is a forward-looking indicator based on signed contracts. The PHSI rose 8.1% from 76.3 to 82.5 in January. However, on a year-over-year basis, pending sales were 24.1% lower than a year ago per the NAR data.
图像: NAHB
