ARLINGTON, Va.—Existing-home sales rose 3.6% in December to a seasonally adjusted annual rate of 5.5 million units, with sales up in all four regions versus a year ago.
In response, NAFCU Chief Economist and Vice President of Research Curt Long said growth is expected to continue.
“Mortgage rates still hover below 4%, driving sales in a strong economy," said Long. “Months of supply has ticked down for seven consecutive months and is now the lowest number in the [National Association of Realtors'] records dating back two decades. The shortage is particularly acute at lower price points.”
The median existing home price rose from $271,300 in November to $274,500 in December. That amount represents a 7.8% increase from the median price a year ago, Long said.
Based on current sales, there were three months of supply at the end of December, down 0.7 months from November. Analysts consider 6 months of supply to be roughly balanced between supply and demand.
The ‘Good News’
"The good news is that construction activity has picked up recently, including December housing starts at levels not seen in years, which could help to alleviate some of that pressure. NAFCU expects further growth in the housing market in 2020 as some of the new construction comes onto the market and alleviates the supply concerns," Long concluded.