Existing-Home Sales and Pending Home Sales in May Exhibit Strengthening Recovery

The National Association of Realtors’ (NAR) existing-home sales data and Pending Home Sales Index for May showed gains despite rising interest rates and tight housing inventory. Existing-home sales, completed single-family homes, townhomes, condominiums and co-op transactions, were 4.2% above April sales and 12.9% greater than last May. Sales are the strongest they’ve been since November 2009 when tax credits were available. Meanwhile, limited housing inventory across several markets continues to push up the national median existing-home price. May’s national median price reached $208,000, a 15.4% increase from May 2012. In the West, existing-home sales rose 2.5% over April and were 7.0% higher than last year, even with the tightest regional supply of homes. The median price for the region reached $276,400, a 19.9% jump from last May.

The Pending Home Sales Index, which measures real estate contract activity, showed that pending home sales in May were up 6.7% over April and 12.1% over May last year.  The NAR indicated that this is the strongest level of contract activity since December 2006. Contract activity in the West increased by 16.0% from the prior month, but was only 1.1% over a year ago.

Lawrence Yun, chief economist for the NAR, is confident that May’s housing data exhibits a strengthening recovery but warns that limited housing supply will continue for the remainder of the year in “much of the country.” http://bit.ly/19FU43c

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