Existing-Home Sales Surge to Record Pace in June
July 22, 2020
Existing-home sales rebounded at a record pace in June, following three consecutive months of sales declines, the National Association of REALTORS® reported on Wednesday. Each of the four major regions of the U.S. posted month-over-month increases in June, with the West posting the largest jump.
Total existing-home sales—completed transactions that include single-family homes, townhomes, condos, and co-ops—increased 20.7% from May to a seasonally adjusted annual rate of 4.72 million in June, NAR reports. Sales, however, are still down 11.3% from a year ago.
“The sales recovery is strong, as buyers were eager to purchase homes and properties that they had been eyeing during the shutdown,” says Lawrence Yun, NAR’s chief economist. “This revitalization looks to be sustainable for many months ahead as long as mortgage rates remain low and job gains continue.”
Housing inventories, a big obstacle for buyers before the pandemic, have tightened further. Inventory levels in June fell 18.2% compared to a year ago, NAR reports. The low inventories continue to press on home prices. NAR pegs current inventory to be 4.0 months, down from 4.3 months one year ago.
“Home prices rose during the lockdown and could rise even further due to heavy buyer competition and a significant shortage of supply,” Yun says.
Here are more key indicators from NAR’s latest housing report:
- Home prices: The median existing-home price was $295,300 in June, up 3.5% from a year ago. Prices rose in every major area of the U.S. in June.
- Days on the market: Sixty-two percent of homes sold in June were on the market for less than a month. Properties typically remained on the market for 24 days in June, down from 27 days in June 2019.
- First-time buyers: First-time home buyers comprised 35% of sales in June, up from 34% in May but about equal to June 2019.
- Investors and second-home buyers: Individual investors or second-home buyers purchased 9% of homes in June, down from 14% in May and 10% in June 2019. Investors and second-home buyers tend to make up the bulk of cash sales. All-cash sales in June accounted for 16% of transactions in June, down from 17% in May but equal to 16% in June 2019.
- Distressed sales: Foreclosures and short sales comprised 3% of sales in June, about even with May but up from 2% in June 2019.
Here’s how existing-home sales fared across the country in June:
- Northeast: Existing-home sales increased 4.3% last month, reaching an annual rate of 490,000—a 27.9% decrease from a year ago. Median price: $332,900, up 3.6% from June 2019.
- Midwest: Existing-home sales rose 11.1% to an annual rate of 1,100,000 in June, down 13.4% from a year ago. Median price: $236,900, a 3.2% increase from June 2019.
- South: Existing-home sales increased 26% to an annual rate of 2.18 million in June, down 4% from a year ago. Median price: $258,500, a 4.4% increase from a year ago.
- West: Existing-home sales increased 31.9% to an annual rate of 950,000 in June, a 13.6% decrease from a year ago. Median price: $432,600, up 5.4% from June 2019.
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Updated: October 30, 2020