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Dismal Month for Existing Home Sales

Mortgage News

Monthly sales of pre-owned homes fell to the lowest level in two years, while the annual rate was down from a year earlier by the most in three years.

The sale of 313,000 existing residential properties — including single family homes, townhomes, condominiums and co-operatives — were closed during January.

That turned out to be the lowest number of existing home sales since
January 2016, when the total was previously reported at 302,000.

Last month’s numbers were reported Wednesday by the National Association of Realtors.

On a seasonally adjusted basis, the annual rate of existing home sales was 5.38 million, retreating by 3 percent from December — the second consecutive month-over-month decrease. Sales were down from January 2017 by nearly 5 percent — marking the largest year-over-year decline in three years.

“The utter lack of sufficient housing supply and its influence on higher home prices muted overall sales activity in much of the U.S. last month,” NAR Chief Economist Lawrence Yun said in the announcement. “While the good news is that Realtors in most areas are saying buyer traffic is even stronger than the beginning of last year, sales failed to follow course and far lagged last January’s pace. It’s very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth.”

There were 1.52 million existing homes in the inventory of homes for sale, which was a 3.4-month supply.
The inventory has declined on a year-over-year basis for 32 consecutive months.

In
the Midwest, the annual rate of sales was a seasonally adjusted 1.25 million, declining from the prior month by 6 percent — the most of any region. The rate in the West fell 5 percent to 1.14 million, while it dropped 1.4 percent to 0.73 million in the Northeast and 1.3 percent to 2.26 million in the South.

For just single-family homes, the annual rate was 4.76 million during the most-recent month.

January 2018’s median U.S. sales price was $240,500, and the average was $282,100.

First-time buyer share last month was 29 percent, while
all-cash share was 22 percent, and distressed sales share was 5 percent.

Average time on the market was 42 days.

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