Existing home sales crushed expectations climbing 6.5% in July to an annualized pace of 5.39 million units. This was up 17.2% year-over-year.
June’s numbers were revised lower to show a 1.6% fall to 5.06 million units.
Meanwhile, total housing inventory was up 5.6% at the end of July to 2.28 million. This represents a 5.1-month supply at the current sales pace. The median time that most homes spend on the market was 42 days in July, this is up from 37 the previous month
The national median price for existing homes was 13.7% higher than a year ago at $213,500. This is the seventeenth straight monthly rise. A key finding was that first time buyers were down from 34% of all purchases a year ago, to 29% this time around.
Distressed homes, which include foreclosures and short sales accounted for 15% of July sales, the same as June.
Economists have been watching for the impact of the run up in mortgage rates on existing and new home sales. The 30-year mortgage rate stands at 4.4% according to Freddie Mac’s primary mortgage market survey (PMMS).
“Mortgage interest rates are at the highest level in two years, pushing some buyers off the sidelines,” said Lawrence Yun chief economist at NAR in a press release.
“The initial rise in interest rates provided strong incentive for closing deals. However, further rate increases will diminish the pool of eligible buyers.”
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