Sales of existing homes in May leapt forward to their strongest pace in nearly 10 years. According to the National Association of Realtors®, this spring's growth in demand amidst lagging supply levels nudged the median sales price to an all-time high. All major regions except for the Midwest saw strong sales increases last month.
Total existing-home sales (measuring transactions for single-family homes, townhomes, condominiums and co-ops) grew 1.8 percent to a seasonally adjusted annual rate of 5.53 million in May from a downwardly revised 5.43 million in April. Sales now sit at the highest annual velocity since February 2007 (5.79 million).
NAR's chief economist, Lawrence Yun, said that existing sales continued apace, rising in May for a third month in a row. He noted, "This spring's sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more homeowners realizing the equity they've accumulated in recent years and finally deciding to trade-up or downsize." Yun also noted that, "With first-time buyers still struggling to enter the market, repeat buyers using the proceeds from the sale of their previous home as their down payment are making up the bulk of home purchases right now."
- May's median existing-home price (all housing types) was $239,700, up 4.7 percent from May 2015 ($228,900). This eclipses the peak median sales price observed last June ($236,300) and marks 51 straight months of year-over-year gains.
Unsold inventory nationally is at a 4.7-month supply at the current sales pace, unchanged from April.
- First-time buyers represented 30 percent of transactions in May, a drop from 32 percent both in April and one year ago. First-time buyers in all of 2015 also averaged 30 percent.