WASHINGTON—Existing home sales increased 11.8% in February, rebounding from January's 1.2% decrease.
"While price growth has moderated recently, the market remains a tight one for homebuyers, and price pressures will grow if the rise in demand reflected in the February data persists," said NAFCU Chief Economist and Vice President of Research Curt Long, noting he predicted the rebound. "The Federal Reserve's abrupt change in its views on interest rate normalization should also be supportive."
Sales grew in three of the four regions during February: the West increased 16%, followed by the South (+14.9%) and the Midwest (+9.5%). Sales in the Northeast were unchanged from January.
Based on current sales, there were 3.5 months of supply at the end of January, down from 3.9 months in January. Analysts consider six months of supply to be roughly balanced between supply and demand.
The median existing-home price increased from $249,300 in January to $249,500 in February (not seasonally adjusted). That amount represents a 3.6% increase from the median price a year ago.
"A strong labor market and rising real wages should also continue to support demand, but supply constraints will prevent robust sales growth in 2019," Long added.