Existing-home sales improved last month and remain solidly above a year ago, according to the National Association of REALTORS®. Total existing-home sales, which are completed sales of single-family homes, townhomes, condominiums, and co-ops, rose 4.2 percent to a seasonally-adjusted annual rate of 5.18 million in May. That number was 4.97 million in April, and is 12.9 percent higher than the 4.59 million-unit pace experienced last May.
May’s existing-home sales numbers are at the highest level since November 2009, when buyers were eager to take advantage of the tax stimulus. However, sales have remained above year-ago levels for 23 months.
NAR Chief Economist Lawrence Yun says that, while demand is high, the number of homes available for purchase is unlikely to rise anytime soon.
“The housing numbers are overwhelmingly positive. However, the number of available homes is unlikely to grow, despite a nice gain in May, unless new home construction ramps up quickly by an additional 50 percent,” Yun says. “The home price growth is too fast, and only additional supply from new home building can moderate future price growth.”
NAR noted that the median price of existing homes continued to rise by double-digit rates, year-over-year.