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And you thought the numbers were high last month! Existing-home sales in June surpassed the high in 2006, and the median sale price hit an all-time high, according to data released by the National Association of Realtors® on Wednesday.
“All major regions experienced sales gains in June and have now risen above year-over-year levels for six consecutive months,” the NAR said in its release.
The sales of single-family homes, townhomes, condominiums, and co-ops rose 3.2% in June, to a seasonally adjusted annual rate of 5.49 million; in May, the number was 5.32 million and last June it was 5.01 million.
Perhaps you should jump on the condo and co-op train—and quick. Their sales rose 6.6%, more than the 2.8% of single-family homes, but they were still cheaper. The median price for existing condos was $226,500 in June, 5.5% above last year, and the highest since August 2007, when it was $229,200. The median price for existing single-family homes was $237,700, a 6.6% rise from June 2014, and higher even than the peak median sale price in July 2006—$230,900.
Part of the frenzy comes from steady job growth and an uplifted economy, says NAR chief economist Lawrence Yun. “Buyers have come back in force,” he said. Our own chief economist, Jonathan Smoke, notes another difference: the kinds of buyers.
“We’ve now surpassed the strong level of activity in 2013 that was investor-driven and composed of 90% more distressed sales than exists today,” Smoke said. “This is therefore the biggest and healthiest year for existing-home sales since 2006, when speculation was rampant.”
At $236,400, the median existing-home price in June for all housing types was 6.5% above June 2014, surpassing the high of $230,400 in July 2006. The number, NAR writes, “marks the 40th consecutive month of year-over-year gains.” And NAR’s not the only organization reporting an uptick in numbers. The Federal Housing Finance Agency’s monthly House Price Index rose 0.4% in May.
The reason? You guessed it. Good old supply (low) and demand (high); housing inventory in June rose only 0.9%, to 2.3 million existing homes for sale. All-cash sales are down, too, from 24% in May to 22% in June.
We know what it all means for buyers in the hotter home markets, but there are plenty of affordable markets in which to search. Time to tool around in those areas, said Smoke.
“People may need to consider different markets or different areas to find affordability, or they may need to make key trade-offs,” he says.
You might have to give up your hopes of a specific size of home or its location, whether it’s old or new, attached or single-family. But, said Smoke, if you weigh your options, you might not have to give up completely on the American dream.
Regional breakdown
Northeast: 4.3% increase to the annual rate of 720,000, 12.5% above last year. The median price was $281,200, 3.9% higher than June 2014.
Midwest: 4.7% increase to the annual rate of 1.33 million in June, 12.7% above last year. The median price was $190,000, 7.2% higher than June 2014.
South: 2.3% increase to the annual rate of 2.20 million in June, 7.3% above last year. The median price was $205,000, 7.2% higher than June 2014.
West: 2.5% increase to the annual rate of 1.24 million in June, 8.8% above last year. The median price was $328,900, 9.9% above June 2014.