For the first time in a year, sales of existing homes increased from the previous month, the National Association of Realtors (NAR) said Tuesday.
Total existing-home sales increased 14.5% in February from January to a seasonally adjusted annual rate of 4.58 million, the largest monthly percentage increase since July 2020, when sales rose 22.4%, the NAR said.
Year-over-year sales, however, fell 22.6%, down from 5.92 million in February 2022.
Month-over-month sales rose in all four major U.S. regions, while all regions posted year-over-year declines, the report said.
"Conscious of changing mortgage rates, homebuyers are taking advantage of any rate declines," said NAR Chief Economist Lawrence Yun. "Moreover, we're seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs."
Total housing inventory registered at the end of February was 980,000 units, the same as in January but up 15.3% (850,000) from one year earlier. Unsold inventory was at a 2.6-month supply at the current sales pace, down 10.3% from January but up from 1.7 months in February 2022, the NAR said.
"Inventory levels are still at historic lows," Yun said. "Consequently, multiple offers are returning on a good number of properties."
Home-Price Increase Streak Ends
The median existing-home price for all housing types in February was $363,000, down 0.2% from $363,700 a year earlier. That ended the streak of 131 consecutive months of year-over-year increases, the longest on record.
Prices climbed in the Midwest and South, but fell in the Northeast and West, NAR said.
Properties typically remained on the market for 34 days in February, up from 33 in January and 18 in February 2022. Of the homes sold in February, 57% were on the market for less than a month.
First-time buyers were responsible for 27% of sales in February, down from 31% in January and 29% a year earlier. NAR's 2022 Profile of Home Buyers and Sellers — released in November 20224 — found that the annual share of first-time buyers was 26%, the lowest since NAR began tracking the data.
All-cash sales accounted for 28% of transactions in February, down from 29% in January but up from 25% in February last year.
Individual investors or second-home buyers, who make up many cash sales, purchased 18% of homes in February, up from 16% in January but down from 19% in February 2022.
Distressed sales — which include foreclosures and short sales — represented 2% of sales in February, nearly identical to last month and a year earlier.
According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.6% as of March 16, down from 6.73% the previous week but up from 4.16% a year ago.
Single-family home sales soared to a seasonally adjusted annual rate of 4.14 million in February, up 15.3% from 3.59 million in January but down 21.4% from the previous year. The median existing single-family home price was $367,500 in February, down 0.7% from February 2022.
Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 440,000 units in February, up from 410,000 in January but down 32.3% from a year earlier. The median existing condo price was $321,000 in February, an annual increase of 2.5%.
By Region
Existing-home sales in the Northeast improved 4% from January to an annual rate of 520,000 in February, down 25.7% from a year earlier. The median price in the Northeast was $366,100, down 4.5% from the previous year.
In the Midwest, existing-home sales grew 13.5% from the previous month to an annual rate of 1.09 million in February, declining 18.7% from one year ago. The median price in the Midwest was $261,200, up 5% from February 2022.
Existing-home sales in the South rebounded 15.9% in February from January to an annual rate of 2.11 million, a 21.3% decrease from the prior year. The median price in the South was $342,000, an increase of 2.7% from one year ago.
In the West, existing-home sales rocketed 19.4% in February from the prior month to an annual rate of 860,000, down 28.3% from the previous year. The median price in the West was $541,100, down 5.6% from February 2022.
NAR is America's largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.
