Surging Home Sales Herald Strong Spring Market

The spring housing market blasted in across the county lastrnmonth and existing home sales jumped 6.1 percent from the February level to thernhighest annual rate in 18 months.  ThernNational Association of Realtors®rn(NAR) said March sales were at a seasonally adjusted annual rate of 5.19rnmillion units compared to 4.89 million in February.  The rate of sales tied those in Septemberrn2013, which had been the most recent high in sales.  The March increase was the largest month-over-monthrngain since a +6.2 percent change in December 2010.</p

The pace of sales of existing single-family homes,rntownhomes, condominiums, and co-ops in March was 10.4 percent higher than inrnMarch 2014 and represented the sixth consecutive month of annualrnincreases.  It was also the largestrnyear-over-year increase since August 2013’s 10.7 percent rise.</p

Single-family home sales rose 5.5rnpercent to a seasonally adjusted annual rate of 4.59 million from 4.35 millionrnin February, and were 10.9 percent above the 4.14 million pace a year previous.rnExisting condominium and co-op sales increased 11.1 percent to a seasonallyrnadjusted annual rate of 600,000 units in March from 540,000 units in February,rnand are now 7.1 percent higher than March 2014 (560,000 units). </p

Lawrence Yun, NAR chief economist, saysrnthe housing market appears to be off to an encouraging start this spring.rn”After a quiet start to the year, sales activity picked up greatlyrnthroughout the country in March,” he said. “The combination of lowrninterest rates and the ongoing stability in the job market is improving buyerrnconfidence and finally releasing some of the sizable pent-up demand thatrnaccumulated in recent years.”</p

The inventory of existing homesrnincreased to 2.0 million homes for sale, a gain of 5.3 percent for the monthrnand 2.0 percent higher than a year earlier. rnThe unsold inventory is estimated at a 4.6-month supply at the currentrnsales pace, down from 4.7 months in February.</p

“The modest rise in housing supplyrnat the end of the month despite the strong growth in sales is a welcomingrnsign,” adds Yun. “For sales to build upon their current pace,rnhomeowners will increasingly need to be confident in their ability to sellrntheir home while having enough time and choices to upgrade or downsize. Morernlistings and new home construction are still needed to tame price growth andrnprovide more opportunity for first-time buyers to enter the market.”</p

The median existing-home price for allrnhomes in March was 7.8 percent higher than in March 2014 at $212,100.  The month was the 37th consecutive one inrnwhich annual prices increased and the change was the largest since an 8.8rnpercent year-over-year gain in February 2014.  The median existing single-family home pricernwas $213,500, up 8.7 percent from March 2014 and the median condo price was 1.6rnpercent higher at $201,400.</p

Foreclosures made up 7 percent of salesrnduring the month and 3 percent were short sales.  Total distressed sales accounted for 11rnpercent of all sales in February and 14 percent in March 2014.  Foreclosures sold for an average discount ofrn16 percent below market value in March while short sales were also discountedrn16 percent.</p

For the third time in 12 months thernshare of first-time buyers broke through 30 percent, rising to that exact numberrnin March from 29 percent in February. Investors purchased 14 percent of homesrnsold in both February and March but this was down from 17 percent in Marchrn2014.  Seventy percent of investors paidrncash for the homes they purchased during the month and total cash salesrnaccounted for 24 percent of all transactions, down from 26 percent in February andrn33 percent the previous March.  </p

Properties typically stayed on thernmarket for a shorter time period in March (52 days) compared to February (62rndays), and are also selling slightly faster than a year ago (55 days). Shortrnsales were on the market the longest at a median of 165 days in March, whilernforeclosures sold in 56 days and non-distressed homes took 51 days. Fortyrnpercent of homes sold in March were on the market for less than a month.</p

Regional sales also boomed in March.  Sales in the Northeast increased 6.9 percentrnto an annual rate of 620,000, and were 1.6 percent above a year ago.  Prices however eased with the median down 1.6rnpercent from a year earlier to $240,500. </p

In the Midwest, existing-home salesrnjumped 10.1 percent to an annual rate of 1.20 million in March, and were 12.1rnpercent above March 2014. The median price in the Midwest was $163,600, up 9.7rnpercent from a year ago.</p

Existing-home sales in the Southrnclimbed 3.8 percent to an annual rate of 2.19 million in March, and were 11.7rnpercent above March 2014. The median price in the South was $187,900 an annualrnincrease of 9.3 percent.</p

Existing-home sales in the West rosern6.3 percent to an annual rate of 1.18 million in March, and 11.3 percent comparedrnto the prior year. The median price in the West gained 8.3 percent to $305,000.

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