Sales of previously owned homes rose 4.2% in May from the prior month to the highest level in three-and-a-half years.
The National Association of Realtors reported Thursday that sales of existing single-family homes rose to a 5.18 million seasonally adjusted annual rate in May from a 4.97 million rate in April.
Sales of single-family homes were particularly strong, rising 5% from April. Sales of condominiums and co-ops fell 1.7% month-over-month.
Meanwhile, the median price of an existing home sold in May was $208,000, up 15.4% from a year ago.
NAR president Gary Thomas noted that mortgage credit is tight and there is a shortage of homes for homes. Yet homebuyer traffic is up 29% from a year ago. “These conditions are leading to sustainable price growth,” Thomas said.
On a non-seasonally adjusted basis, sales of
Quicken Loans chief economist Bob Walters noted that demand for homes is rising due to higher consumer confidence. “That confidence is now surging and it is being reflected in home sales and home prices,” Walters said.
In the past few months, there has been a shift to buying higher-priced homes.
In May, 16% of existing home sales involved homes of $100,000 or less, compared to 24% in February. Homes priced in the $250,000 to $500,000 range made up 27% of May sales, compared to 22.8% in February.
Overall, sales of homes priced at $100,000 or less have fallen 9% from May 2012 while sales in the $250,000 to $500,000 range have jumped 28%.
Foreclosure and short sales accounted for 18% of May sales, NAR said, “matching the lowest share since monthly tracking began in October 2008.”
