US home sales rise shoot up to 10-year high

Francis Osborne
April 22, 2017

Sales of United States existing home sales rose more than expected in March, to their highest pace in more than 10 years, according to data from the National Association of Realtors.

Total existing home sales, completed transactions including single-family homes, townhomes, condominiums and co-ops, increased 4.4% to a seasonally adjusted rate of 5.71 million in March, according to NAR's report.

Chicago home sales and prices rebounded strongly in March from a surprisingly sluggish February, just in time for the all-important spring housing season.

Sales hit a seasonally adjusted annual rate of 5.71 million last month from a downwardly revised 5.47 million in February.

And although "finding available properties to buy continues to be a strenuous task for many buyers, there was enough of a monthly increase in listings in March for sales to muster a strong gain".

Sales activity in the near-term is expected to stay restricted by still-low levels of inventory and rapidly rising prices that continue to outstrip income growth, stated TD Economics.

The median existing-home price for all housing types in March was $236,400, up 6.8% from March 2016 ($221,400).

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Total housing inventory experienced a boost as well, with a 5.8 percentage point jump to 1.83 million homes for sale - a much-needed jump from the rock bottom levels experienced in the last few months.

All homes were on the market for an average of 34 days in March, down from 45 days in February and down from 47 days in March 2016.

Economists had been expecting a rate of 5.63m. All told, 48 percent of homes sold in March were on the market for less than one month.

Mortgage buyer Freddie Mac said Thursday that the average interest rate on 30-year fixed-rate home loans declined to 3.97 percent this week from 4.08 percent last week. "A growing pool of all types of buyers is competing for the lackluster amount of existing homes on the market".

Twenty-three percent of existing-home sales in March were all-cash, compared to 15 percent by individual investors. That's a 4 percent increase over the prior month.

Existing-home sales in the South rose 3.4% in March to an annual rate of 2.42 million and are 8.5% higher than March 2016 sales.

First-time homebuyers comprised 32 percent of existing-home sales in March. "Over the a year ago home sales under $100,000 fell 7.1 percent while sales between $500,000 and $750,000 went up by 32.1 percent, due to builders' focus on the higher-end market".

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