Existing-home sales and prices rise in November

Existing-home sales continued the gain momentum in November and increased for a third consecutive month.

The National Association of Realtors (NAR) reported this morning that existing-home sales increased 1.9% last month to a seasonally adjusted rate of 6.46 million. Compared to a year ago, sales fell 2% from a rate of 6.59 million.

Sales include completed transactions of single-family homes, townhomes, condominiums, and co-ops.

Single-family home sales rose to a seasonally adjusted annual rate of 5.75 million in November, up 1.6% from 5.66 million in October and down 2.2% from one year ago. 

“Determined buyers were able to land housing before mortgage rates rise further in the coming months,” said Lawrence Yun, NAR’s chief economist. “Locking in a constant and firm mortgage payment motivated many consumers who grew weary of escalating rents over the last year.”

Yun said that he expects mortgage rates to jump in 2022 but he doesn’t expect the imminent increase “to be overly dramatic.” The economist forecasts the 30-year fixed mortgage rate to average at 3.7% by year-end of 2022.

In the meantime, home prices continue to dramatically rise. 

The median existing-home price for all housing types in November was $353,900, up 13.9% from November 2020 and a cost of $310,800. This marks 117 straight months of year-over-year increases, the longest-running streak on record, the NAR said.

The median existing single-family home price was $362,600 in November, up 14.9% from November 2020.

At the end of November, total housing inventory stood at 1.11 million units, down 9.8% from October and down 13.3% from one year ago and 1.28 million units. Unsold inventory sits at a 2.1-month supply at the current sales pace, a decline from both the prior month and from one year ago.

“Supply-chain disruptions for building new homes and labor shortages have hindered bringing more inventory to the market,” said Yun. “Therefore, housing prices continue to march higher due to the near-record-low supply levels.”

Properties typically remained on the market for 18 days in November, equal to October and down from 21 days in November 2020. About 83% of homes sold in November 2021 were on the market for less than a month.

Here’s how existing-home sales performed by region:

• In the Northeast, sales were flat compared to the prior month and recorded an annual rate of 760,000. This is an 11.6% decrease from the November 2020 rate. The median price in the Northeast was $372,500, up 4.7% from one year ago.
• Existing-home sales in the Midwest edged up 0.7% to an annual rate of 1.52 million in November, a 0.7% drop from a year ago. The median price in the Midwest was $260,100, a 9% jump from November 2020.
• Sales in the South grew 2.9% in November, registering an annual rate of 2.85 million. This is also a 1.1% increase from a year ago. The median price in the South was $318,900, an 18.4% surge from one year prior.
• Existing-home sales in the West increased 2.3%, reaching an annual rate of 1.33 million in November, down 3.6% from one year ago. The median price in the West was $507,200, up 8.4% from November 2020.