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US existing home sales rise to six-month high
[WASHINGTON] US home resales unexpectedly rose in January, reaching a six-month high, in the latest sign that the economy remains on firmer ground despite slowing global growth and tightening financial market conditions.
The National Association of Realtors said on Tuesday existing home sales increased 0.4 per cent to an annual rate of 5.47 million units, the highest level since July. Last month's sales pace was also the second highest since 2007.
December's sales pace was revised slightly down to 5.45 million units from the previously reported 5.46 million. Sales rose strongly in the US Northeast, despite a massive snowstorm, and were also up in the Midwest.
Economists had forecast home resales decreasing 2.9 per cent to a pace of 5.32 million units last month. Sales were up 11 per cent from a year ago. The NAR also revised sales data going back three years, which showed little change in the housing market's upward trajectory.
The median price for a previously owned home increased 8.2 per cent to $213,800 from a year ago, and more first-time buyers entered the market.
The housing report added to retail sales, industrial production and employment data in suggesting that the economy regained some momentum after slowing to a crawl in the fourth quarter.
Sales have been volatile following the introduction in October of new mortgage regulations, which are intended to help homebuyers understand their loan options and shop around for loans best suited to their financial circumstances.
Realtors say these regulations, which saw a plunge in sales in November that was followed by a surge in December, have significantly increased contract closing time frames.
Housing continues to be supported by a tightening labor market, which is starting to push up wage growth, boosting household formation. But a lack of properties available for sale remains a challenge.
In January, the number of unsold homes on the market rose 3.4 per cent from December to 1.82 million units, but was down 2.2 per cent from a year ago.
At January's sales pace, it would take 4.0 months to clear the stock of houses on the market, up from 3.9 months in December. A six-month supply is viewed as a healthy balance between supply and demand.