ARLINGTON, Va.—Existing-home sales decreased 1.3% in January to a seasonally-adjusted, annual rate of 5.46 million units.
This represents a 9.6% increase in sales versus a year ago and NAFCU Chief Economist and Vice President of Research Curt Long said growth is expected to continue steadily.
“Mortgage rates still hover below 4%, driving sales in a strong economy,” said Long. “The housing shortage continues, even as housing inventory ticked up slightly this month to its lowest January level since 1999. The shortage is particularly acute at lower price points.”
The median existing home price fell from $274,500 in December to $266,300 in January, up 6.8% from a year ago. Based on current sales, there were 3.1 months of supply at the end of January, up slightly from December. Analysts consider 6 months of inventory a rough balance between supply and demand.
The Good News
“The good news is housing starts continue to rise, declining slightly from December but up 21.4% versus January 2019, which should help to alleviate some of that pressure. NAFCU expects steady growth in 2020, including some supply relief as some of the new construction comes onto the market,” Long concluded.