Existing Home Sales Soar in December
All Four U.S. Regions Post Solid Gains
Sales of existing homes were robust in the month of December, as total transactions jumped 14.7 percent to 5.46 million units, compared to November's 4.75 million units.
Data from the National Association of Realtors shows that all four regions of the nations saw large increases in the sales of single-family homes, townhomes, condominiums and co-ops.
Sales are also up 7.7 percent on a year-over-year basis, but the NAR foresees certain challenges in the year ahead.
"Although some growth is expected, the housing market will struggle in 2016 to replicate last year's 7 percent increase in sales," said Lawrence Yun, the NA's chief economist. "In addition to insufficient supply levels, the overall pace of sales this year will be constricted by tepid economic expansion, rising mortgage rates and decreasing demand for buying in oil-producing metro areas."
The NAR said 32 percent of the transactions in December involved first-time buyers, up from 30 percent in November and 29 percent from a year ago. First-time buyers in all of 2015 represented an average of 30 percent, up from 29 percent in both 2014 and 2013.
"First-time buyers were for the most part held back once again in 2015 by rising rents and home prices, competition from vacation and investment buyers and supply shortages," Yun said. "While these headwinds show little signs of abating, the cumulative effect of strong job growth in recent years and young renters' overwhelming interest to own a home should lead to a modest uptick in first-time buyer activity in 2016."
Single-family home sales jumped 16.1 percent to an annual rate of 4.82 million units in December, up from 4.15 million units in November. Sales are 7.1 percent higher than the 4.50 million pace of a year ago.
Existing condominium and co-op sales increased 4.9 percent to 640,000 units for the month, compared to the 610,000 units in November. Sales are 12.3 percent above December 2014 (570,000 units).
The median price of a single-family home was $226,000 in December, up 8.0 percent from the same month in 2014. The median existing condo price was $209,900 in December, which is 4.9 percent above a year ago.
On a regional basis:
Existing home sales in the Midwest jumped 10.9 percent to 1.22 million units in December, and are 9.9 percent higher year-over-year.
Sales in the Northeast climbed 8.7 percent to 750,000 units for the month, and are also 11.9 percent higher than December 2014.
Transactions in the South leaped 14.6 percent to 2.27 million units in December, and are also 4.6 percent ahead of the pace of a year ago.
Purchases in the West jumped 23.2 percent to 1.22 million units in the month, and are 8.9 percent higher than December 2014.