After a record-setting July, the homes market still shows no sign of cooling off.
Sales of existing homes rose 2.4% to a seasonally adjusted annualized pace of 6 million units, according to the National Association of Realtors. Sales were 10.5% higher compared with August 2019. This is the squeakiest sales pace since December 2006, before the Great Recession.
Sales were hampered only by want of supply. There were 1.49 million homes for sale at the end of August, down 18.6% annually to a 3.0-month contribute. The number of homes for sale when sales were last this robust, in 2006, was more than facsimile the current supply.
That tight supply pushed the median price of an existing home sold in August to a minutes high of $310,600. That is up 11.4% annually. In the third quarter of this year the housing wealth will attired in b be committed to increased by $1.5 trillion from the second quarter.
“The imbalance of supply and demand will hurt affordability presently. Once that appears it will hinder home ownership rates,” said Lawrence Yun, chief economist for the Realtors.
Tough rivalry has the market moving very quickly. It took just 22 days to sell a home in August, matching the fastest on privately.
Mortgage rates set several record lows in August, which only added to the fierce competition for housing. Low fees also kept the heat on home prices, as they give buyers additional purchasing power.
Regionally, garage sales were strongest in the Northeast, rising 13.8% month to month. Sales were 1.4% higher in the Midwest and 0.8% high-pitched in both the South and West. The Northeast saw some of the strictest shutdown rules early in the coronavirus pandemic, so the recovery now may be earning up for that.
Sales of newly built homes, which are counted by signed contracts, not closings, jumped 36% annually in July. Builders are profiting from the tight supply of existing homes for sale, as well as for the new consumer demand for higher-tech homes in suburban and country locations.
Strong demand is expected to continue into the usually slower fall months, but there may be a brief quit in the numbers because of the various natural disasters across the nation.
“In early September, new housing supply took a hit from the wildfires and twisters, and sales activity weakened. But because the impact of natural disasters has been more supply-oriented than demand-oriented, expenses are expected to remain high,” said Danielle Hale, chief economist at realtor.com. “The combination of high prices and low fulfil is going to continue to make finding a home an even more difficult task than it already is.”