Monthly sales of the nation’s pre-owned stock of houses climbed to the fastest pace in more than eight years and might have risen further if not for the Northeast.
Sales of existing homes — including single-family homes, townhomes, condominiums and co-ops — reached a seasonally adjusted annual rate of 5.59 million in July.
Home sales sped up from the previous month, when the pace was 5.48 million. June’s rate was originally reported at 5.49 million.
It was the third consecutive month existing home sales moved higher, according to the National Association of Realtors, which released the report Thursday.
Sales also strengthened compared to July 2014, when the annual rate was a seasonally adjusted 5.07 million.
In addition, July 2015’s rate was “the highest pace since February 2007,” when the rate was 5.79 million.
“The creation of jobs added at a steady clip and the prospect of higher mortgage rates and home prices down the road is encouraging more households to buy now,” Lawrence Yun, NAR chief economist, said in the report. “As a result, current homeowners are using their increasing housing equity towards the down payment on their next purchase.”
Single-family transactions accounted for 4.96 million of July 2015’s annual rate, while condominium and coop sales made up 0.63 million.
Sales to first-time home buyers thinned for the second month in a row to 28 percent — the leanest share since January. In July of last year, first-time buyer share was 29 percent.
“The fact that first-time buyers represented a lower share of the market compared to a year ago even though sales are considerably higher is indicative of the challenges many young adults continue to face,” Yun said. “Rising rents and flat wage growth make it difficult for many to save for a down payment, and the dearth of supply in affordable price ranges is limiting their options.”
Helping to fuel the national surge were home sales in the South, which climbed more than four percent from June to a 2.29 million annual rate.
A more than three percent increase in the West left the region with an annual rate of 1.28 million.
The Midwest saw no change from the 1.32 million rate in June.
The only region to hold back the national average was the Northeast, where the annual rate was off nearly three percent from the previous month to 0.70 million.
Last month’s median U.S. existing home price was $234,000, retreating from June’s $236,400 but ascending by six percent from July 2014 — the 41st year-over-year increase.
At 2.24 million existing homes available for sale, the total housing inventory was down 0.4 percent from a month earlier and 5 percent less than a year earlier.
The unsold inventory would take 4.8 months to unload at the current pace, less than 4.9 months in June.
“Despite the strong growth in sales since this spring, declining affordability could begin to slowly dampen demand,” Yun predicted. “Realtors in some markets reported slower foot traffic in July in part because of low inventory and concerns about the continued rise in home prices without commensurate income gains.”
Homes were on the market for 42 days during the most-recent month, far more than the previous report’s 34 days but fewer than the year-earlier report’s 48 days.
All-cash share was 23 percent, while distressed share was seven percent.