US home sales rose to a one-year high

US home sales rose to a one-year high

Home sales rose 9.5% last month, to a seasonally adjusted annual rate of 4.38 million units.

The sales of existing homes in the United States rose to a one-year high in February as supply improved, a trend that, along with the decline in mortgage ratescould support activity during the spring sales season.

The Home sales increased 9.5% last monthat a seasonally adjusted annual rate of 4.38 million unitsthe highest level since February 2023, as reported on Thursday by the National Association of Realtors (NAR, for its acronym in English). He monthly sales increase It was also the highest since February 2023. Economists polled by Reuters expected resales to fall to a rate of 3.94 million units.

The Home resales are recorded at the closing of a contract. February sales likely reflected contracts signed in the previous two months. The rebound came despite a drop in pending home sales in January. Housing inventory rose 5.9% to 1.07 million units last month, rising 10.3% from a year ago.

A satisfied market demand

“The additional housing supply is helping to meet market demand,” said Lawrence Yun, NAR chief economist.

Supply is likely to continue to improve. The government reported Tuesday that construction of single-family homes rose in February to near its highest level in two years, while the total number of completed homes soared to a level last seen in January 2007.

The average rate of the popular 30-year fixed-rate mortgage has fallen in recent weeks after flirting with the 7% level in late February, according to data from mortgage finance agency Freddie Mac. On Wednesday, the Federal Reserve kept its official interest rate unchanged at 5.25%-5 .5%, but the monetary authorities indicated that they still hope to reduce it by three quarters of a percentage point by the end of the year.

Despite the increase in supply, Housing inventory remains far below the nearly 2 million units before the COVID-19 pandemic. Multiple offers remain in many areas, especially in the Northeast, and most homes sold last month were above asking prices, Yun said.

To the February sales paceit would take 2.9 months to exhaust the current inventory of existing homes, compared to 2.6 months a year ago.

Source: Ambito

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