The numbers: Existing home sales in the United States rose 0.6%, to a seasonally adjusted annual rate of 6.69 million, the National Association of Realtors said Friday. Compared to a year ago, home sales increased by 23.7%.
Economists surveyed by the Wall Street Journal had predicted that sales of existing homes would fall at an average rate of 6.66 million.
What happened: The average price of existing housing rose to $ 303,900 in January, up 14.1% from the previous year.
Inventory of homes for sale fell to a record low of 1.04 million units at the end of January. This represents a decrease of 25.7% year-on-year. The market had a supply of homes for sales for 1.9 months. A 6-month supply is considered a sign of a balanced market.
The south and midwest showed an increase in sales in January.
General image: Sales have shifted sideways since a peak cycle was set in October. Economists think low mortgage rates will continue to increase demand for housing in the coming months. Buyers are also looking for more space and more remote locations in the wake of the pandemic.
What the NAR said: “Home sales continue to rise in the first month of the year, as buyers quickly got virtually every new listing coming on the market. Sales could have been even 20% higher if there had been more inventory and more options, ”said Lawrence Yun, chief economist at the NAR.
What do economists say? “Overall, record low mortgage rates and families fleeing busy life situations are fueling demand for single-family homes despite ongoing turmoil in the labor market and higher house prices. In fact, this is a sector emerging from the crisis more strongly than it entered, ”said Josh Shapiro, chief US economist at MFR Inc.
Market reaction: US stocks opened higher on Friday with the S&P 500 SPX index,
increased 12.48 points in the half-day trading after declining in the last three trading sessions.