High prices and low inventory haven’t prevented homebuyers from closing on a record number of…
High prices and low inventory haven’t prevented homebuyers from closing on a record number of houses recently.
According to the National Association of Realtors, existing-home sales surged for the third straight month in November 2017 and reached their strongest pace in almost 11 years.
All major regions except for the West saw a significant hike in sales activity in November 2017.
Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, jumped 5.6 percent2 to a seasonally adjusted annual rate of 5.81 million in November from an upwardly revised 5.50 million in October 2017.
After November’s increase, sales are 3.8 percent higher than a year ago and are at their strongest pace since December 2006 (6.42 million).
Total housing inventory at the end of November dropped 7.2 percent to 1.67 million existing homes available for sale, and is now 9.7 percent lower than a year ago (1.85 million) and has fallen year-over-year for 30 consecutive months.
Unsold inventory is at a 3.4-month supply at the current sales pace, which is down from 4.0 months a year ago.
First-time buyers were 29 percent of sales in November 2017, which is down from 32 percent both in October and a year ago. NAR’s 2017 Profile of Home Buyers and Sellers – released earlier in the year – revealed that the annual share of first-time buyers was 34 percent.
This means that a higher proportion of buyers were investors paying cash. While that helps to keep sales in record territory, it does not exactly bode well for the long-term health or sustainability of the market.