The Northeast saw a big surge in existing-home sales this November, while smaller gains in the South also helped to push existing-home sales up nationwide for the third consecutive month, according to newly published statistics from the National Association of Realtors.
The NAR said in its latest monthly report that total existing-home sales, which includes single-family homes, townhomes, condominiums and co-ops,jumped by 0.7 percent to a seasonally adjusted annual rate of 5.61 million in November, from a downwardly revised 5.57 million the month before. According to the NAR, November's sales rate is now on pace to reach the highest level since February 2007, when 5.79 million existing-homes were sold.
The housing market has experienced an outstanding three-month stretch in the run up to Christmas, said NAR chief economist Lawrence Yun.
"The healthiest job market since the Great Recession and the anticipation of some buyers to close on a home before mortgage rates accurately rose from their historically low level have combined to drive sales higher in recent months," Yun said in a statement. "Furthermore, it's no coincidence that home shoppers in the Northeast — where price growth has been tame all year — had the most success last month."
The median existing-home price 3 for all housing types in November was $234,900, up 6.8 percent from November 2015 ($220,000). November's price increase marks the 57th consecutive month of year-over-year gains.
Total housing inventory at the end of November dropped 8.0 percent to 1.85 million existing homes available for sale, and is now 9.3 percent lower than a year ago (2.04 million) and has fallen year-over-year for 18 straight months. Unsold inventory is at a 4.0-month supply at the current sales pace, which is down from 4.3 months in October.
"Existing housing supply at the beginning of the year was inadequate and is now even worse heading into 2017," added Yun. "Rental units are also seeing this shortage. As a result, both home prices and rents continue to far outstrip incomes in much of the country."
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage leaped to 3.77 percent in November from 3.47 percent in October (highest rate since January at 3.87 percent). The average commitment rate for all of 2015 was 3.85 percent.
First-time buyers were 32 percent of sales in November, which is down from 33 percent in October but up from 30 percent a year ago. The NAR's 2016 Profile of Home Buyers and Sellers revealed that the annual share of first-time buyers was 35 percent (32 percent in 2015), which is the highest since 2013 (38 percent).
"First-time buyers in higher priced cities will be most affected by rising prices and mortgage rates next year and will likely have to stretch their budget or make compromises on home size, price or location," said Yun.
Properties typically stayed on the market for 43 days in November, up from 41 days in October but down considerably from a year ago (54 days). Short sales were on the market the longest at a median of 110 days in November, while foreclosures sold in 55 days and non-distressed homes took 41 days. Forty-two percent of homes sold in November were on the market for less than a month.