NEW YORK – Existing home sales increased 7.7% in August to a seasonally adjusted 5.03 million-unit rate, after an unrevised 4.67 million unit rate in July, the National Association of Realtors announced Wednesday.
Economists polled by Thomson Reuters predicted 4.74 million sales.
On a year-over-year basis, sales overall were up 18.6% from a 4.24 million unit sales pace last August.
“Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” said Lawrence Yun, NAR chief economist. “Investors were more active in absorbing foreclosed properties. In additional to bargain hunting, some investors are in the market to hedge against higher inflation.”
“We had some disruptions from Hurricane Irene in the closing weekend of August, when many sales normally are finalized, along the Eastern seaboard and in New England,” Yun said. “As a result, the Northeast saw the smallest sales gain in August, and some general impact is expected in September with widespread flooding from Tropical Storm Lee. Aberrations in housing data are possible over the next couple months as markets recover from disrupted closings and storm damage.”
Sales rose in all four regions of the country in August, increasing 2.7% in the Northeast to 770,000, climbing 3.8% to 1.09 million units in the Midwest; and jumping 5.4% in the South to 1.94 million. In the West sales surged 18.3% to 1.23 million units, NAR said.
Inventory levels sank 3.0% at the end of August, to 3.58 million existing homes for sale, representing an 8.5-month supply at the current sales pace, down from 9.5 months in last month’s report.
Distressed homes – foreclosures and short sales typically sold at deep discounts – were 31% of sales in August, up from 29% in July.
Meanwhile, the national median existing home price was $168,300 in August, off 5.1% from a year ago.
The national average 30-year, fixed-rate mortgage was 4.27%, down from July’s 4.55%, NAR said. The rate was 4.43% in August 2010.
