Sales of existing homes rose more than expected in April returning close to January’s post-recession high but the volatility of the past ten months continued unabated.
The National Association of Realtors said that purchases of previously occupied homes climbed 1.7 percent last month to an annual rate of 5.45 million after jumping 5.7 percent in March and falling 7.3 percent in February. March sales were revised slightly higher to 5.36 million units from 5.33 million. The median prediction in the Bloomberg survey was for a 1.3 percent gain to 5.40 million. Sales were 6 percent higher on the year.
Home sales had reached their highest point after the 2006-2007 collapse of the housing bubble in July 2015 at 5.48 million annualized units. Since then have fallen sharply twice and recovered twice.
From last July’s high sales fell 11.3 percent in four months to 4.86 million in November. They then rebounded to 5.45 million in December, and 5.47 million in January a 12.6 percent jump, unusually strong numbers for what are normally the slowest months for home sales. From that January they skidded 7.3 percent in the next month to 5.07 million in February. The second sharp recovery in less than a year then brought sales back 7.5 percent in two months at April’s 5.45 million rate.
The prior bout of viability had been prompted by the imposition and then expiration of Federal government programs designed to encourage home ownership.
Existing home sales rose 22.2 percent from August to November 2009, followed by a two month plunge of 23.1 to January 2010. Sales again soared 16.5 percent to May 2010 followed by a 29.3 percent collapse to the all-time low of 3.4 million units in July 2010.
The median sales price for an existing home, $232,500, was 6.3 percent higher in April than the previous year. Prices has increased 5.1 percent February and March. It was the 50th straight month of rising home prices. The price of a single family home increased 6.8 percent over the last twelve months.
Sales varied widely across the country. In the Midwest they boomed gaining 12.1 percent, in the East they rose a modest 2.8 percent while in the South they fell 2.7 percent and in the West the dropped 1.7 percent.
Affordability is likely an issue for many buyers, particular first time purchasers. Sales can be tied to prices as the Midwest is the least expensive, having seen the smallest amount of price increases while the West and South have witnessed the largest gains.
Sales of single family homes, which are just under 90 percent of the market, rose 0.6 percent to 4.81 million annualized. Sales of condominiums and co-ops jumped 9.3 percent to 0.64 million, matching the best level since ether recession, a number also reached in August 2013 and June and December 2015.
The share of first time home buyers, rose slightly to 32 percent from 30 percent. A normal market is historically composed of about 40 percent initial purchasers. The stock of unsold homes rose 9.2 percent to 2.14 million in April, 3.6 percent lower than a year ago. That is a 4.7 months’ supply at the April selling rates.
Last year 5.25 million existing homes changed hands, the largest number since 2006.
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