WASHINGTON, Oct 22 — The short supply of housing in the United States pushed prices up sharply in September, causing sales of existing homes to drop, according to new industry figures released today.
While low interest rates are enticing buyers to purchase new houses, townhouses or condominiums — a third of them first-time home buyers — rising demand is driving prices higher, according to the National Association of Realtors.
The latest NAR report showed sales of existing homes fell 2.2 per cent compared to August, to 5.38 million at a seasonally adjusted annual rate, well below what economists had expected.
The median price for all housing types jumped 5.9 per cent from a year earlier to US$272,100, as prices rose in all regions, NAR said, marking 91 straight months of year-over-year gains. Sales are 3.9 per cent higher than September 2018.
“We must continue to beat the drum for more inventory,” NAR chief economist Lawrence Yun said in a statement.
“Home prices are rising too rapidly because of the housing shortage, and this lack of inventory is preventing home sales growth potential.”
Total housing inventory at the end of September sat at 1.83 million, about the same as for August, but 2.7 per cent below September 2018, the report said.
NAR said all four major regions of the country saw home sales decline, with the Midwest taking the biggest hit, falling 3.1 per cent, while the West did best with a decline of just 0.9 per cent.
Despite the decline in sales — concentrated in single family homes — Ian Shepherdson of Pantheon Macroeconomics pointed to other data showing mortgage applications continue to rise.
“The trend is rising, despite the September dip,” he said in an analysis of the data. “By the end of the winter, though, we expect the upturn to run out of steam as payroll growth slows, layoffs rise and consumers’ confidence fades.” — AFP