The National Association of Realtors® released its data for October existing home sales today. Good news: The volume of sales of this national aggregate number was up 2.5% from October one year ago. The median existing-home price for all housing types in October was $208,300, which is 5.5% above October 2013. This marks the 32nd consecutive month of year-over-year price gains.
Lawrence Yun, NAR chief economist, said “Sales activity in October reached its highest annual pace of the year as buyers continue to be encouraged by interest rates at lows not seen since last summer, improving levels of inventory and stabilizing price growth,” he said. “Furthermore, the job market has shown continued strength in the past six months. This bodes well for solid demand to close out the year and the likelihood of additional months of year-over-year sales increases.”
Total housing inventory at the end of October fell 2.6 % to 2.22 million existing homes available for sale, which represents a 5.1-month supply at the current sales pace – the lowest since March. Six months’ supply is usually considered a balanced market, so we’re not at the edge of shortage. Unsold inventory is now 5.2% higher than a year ago, when there were 2.11 million existing homes available for sale.
Looking ahead to 2015, “The growth in housing supply this year will likely prevent the drastic sales slowdown and coinciding spike in home prices we saw last winter due to low inventory,” says Yun. “However, more housing starts are needed to increase supply, meet current demand and keep price growth in check.”