Existing home sales increased 2.4% in May to a seasonally adjusted 4.77 million-unit rate, the National Association of Realtors announced yesterday.
The sales rise to 4.77 million was smaller than the gain to a 4.81 million-unit pace predicted by Thomson Reuters’ poll of economists and followed a revised 2.4% increase in April to 4.66 million units, originally reported as a 2.9% rise to a 4.68 million unit level.
On a year-over-year basis, sales overall were down 3.6% from a 4.95 million-unit sales pace last May.
“Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” said NAR chief economist Lawrence Yun. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory. However, the increase in sales is less than expected because poor appraisals are stalling transactions. Pending home sales indicated much stronger activity, but some contracts are falling through from faulty valuations that keep buyers from getting a loan.”
