Home sales at highest level since 2007

Sales of previously owned homes in June hit their fastest pace in more than eight years, a sign of the housing market’s strengthening amid better jobs growth.

Existing-home sales, which are completed transactions that include single-family homes and condominiums, increased 3.2 percent to a seasonally adjusted annual rate of 5.49 million in June, up from 5.32 million in May, the National Association of Realtors said Wednesday.

Sales are at their highest level since February, 2007 (5.79 million) and are 9.6 percent above the 5.01 million of a year ago.

The spring buying season has been the strongest since the downturn.

“Buyers have come back in force, leading to the strongest past two months in sales since early 2007,” said Lawrence Yun, NAR chief economist.

“This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that’s giving more households the financial wherewithal and incentive to buy,” he said.

“June sales were also likely propelled by the spring’s initial phase of rising mortgage rates, which usually prods some prospective buyers to buy now rather than wait until later when borrowing costs could be higher,” he said.

The combination of rising demand and limited supply helped push up the national median sales price to an all-time high.

The median existing-home price in June was $236,400, which is 6.5 percent above June 2014 and surpasses the peak median sales price set in July 2006 ($230,400).

All four regions saw sales gains in June and they have risen above year-over-year levels for six consecutive months.

Sales in the Northeast climbed 4.3 percent, 4.7 percent in the Midwest, 2.3 percent in the South and 2.5 percent in the West. 

Total housing inventory at the end of June inched up 0.9 percent to 2.30 million.

Unsold inventory is at a five-month supply at the current sales pace, down from 5.1 months in May.

“The demand for buying has really heated up this summer, leading to multiple bidders and homes selling at or above asking price,” said NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark.

“Furthermore, tight inventory conditions are being exacerbated by the fact that some homeowners are hesitant to sell because they’re not optimistic they’ll have adequate time to find an affordable property to move into,” he said.

The share of first-time buyers fell to 30 percent in June from 32 percent in May.

All-cash sales, usually made by investors, represented 22 percent of transactions in June, matching the lowest share since December 2009 and were down from 24 percent in May.

Distressed sales — foreclosures and short sales — fell to 8 percent in June, matching an August 2014 low.