Existing home sales increased in February, a good sign as the market heads into the spring homebuying season.
Existing home sales rose 9.5% in February to a seasonally adjusted annual rate of 4.38 million, up from 4 million in January, according to a report released Thursday by the National Association of Realtors (NAR). Year over year, sales dipped 3.3%, down from 4.53 million units in February 2023.
Meanwhile, the median price for all types of existing homes rose 5.7% year over year to $384,500. All regions posted price gains, with double-digit growth in the Northeast of 11.5%.
“Additional housing supply is helping to satisfy market demand,” NAR chief economist Lawrence Yun said in a statement. “Housing demand has been on a steady rise due to population and job growth, though the actual timing of purchases will be determined by prevailing mortgage rates and wider inventory choices.”
The inventory of existing homes has been steadily increasing, despite elevated mortgage rates. In the week ending March 15, there were 507,000 single-family homes on the market in the U.S., up 1.3% from a week prior, up 22% from a year ago, and up 105% from two years ago, according to data from Altos Research.
About 59,000 new single-family listings hit the market during the week ending March 15, 24% more than the same week in 2023. Meanwhile, the median price of a single-family home was $435,000, up 1.2% from a year ago, Altos reported.
Nearly all markets are showing inventory growth compared to last year and the gains are expanding every week.
“Family reasons are the primary reasons homeowners are listing their home for sale,” Bright MLS chief economist Lisa Sturtevant said in a statement. “Family changes, such as marriage, divorce, the birth of a child, or caring for an aging parent, will trump mortgage rates for some homeowners who will give up their pandemic-era mortgage rate.”
Meanwhile, builders are on track to deliver significant numbers of new homes this year. Privately owned housing starts grew to a seasonally adjusted annual rate of 1.521 million units in February, a 10.7% increase compared to January.
