ARLINGTON, Va.—Existing-home sales rose 2% in July to a seasonally adjusted rate of 5.99 million units, representing a 1.5% increase in sales versus a year ago.
"Existing home sales rose for the second month in a row fueled by low rates and a recovering job market,” said Curt Long, NAFCU's chief economist and vice president of research. "Demand is very strong and although supply is still tight, homebuilding has picked up.
"Although prices remain elevated, price growth has slowed which is generating more listings from sellers who want to take advantage of the market while it remains favorable," added Long. "On the construction side, housing starts fell 7% this month while permits rose 2.6%.”
Based on current sales, there was 2.6 months of supply at the end of July, unchanged from June. Analysts consider six months of inventory a rough balance between supply and demand, noted the NAFCU analysis.
Growth in 2 Regions
The data show sales rose in two regions versus a year ago, with the Northeast seeing the largest rise, up 12.1% versus July 2020, followed by the South (+1.3%), and the West (+1.7%). Meanwhile, the West was flat, and the Midwest fell 1.4%.
The median existing-home price rose from $362,800 in June to $359,900 in July (not seasonally adjusted), representing a 17.8% increase from the median price a year ago.
"Interest rates are expected to stay very low into the medium-term, increasing demand," concluded Long. "NAFCU expects sales to remain steady through the end of the year, limited mostly by supply."