Existing-home sales pick up the pace
Existing-home sales outdid the expectations of many economists in December, surging 14.7% to a seasonally adjusted annual rate of 5.46 million in December.
That's up from 4.76 million in November, as well as up 7.7% year-over-year. Additionally, December's performance delivered a finishing touch to what's been the best year of existing sales (5.26 million) since 2006 (6.48 million).
According to the National Association of Realtors, the momentum was partially credited to the "Know Before You Owe" initiative, which delayed some of November's would-be transactions.
"While the carryover of November's delayed transactions into December contributed greatly to the sharp increase, the overall pace taken together indicates sales these last two months maintained the healthy level of activity seen in most of 2015," said NAR chief economist Lawrence Yun. "Additionally, the prospect of higher mortgage rates in coming months and warm November and December weather allowed more homes to close before the end of the year."
The median existing-home price was $224,100, up 7.6% year-over-year.
Total housing inventory at the end of December dropped 12.3% to 1.79 million existing homes available for sale, which is 3.8% lower than a year ago.
As for the single-family market, home sales jumped 16.1% to a seasonally adjusted annual rate of 4.82 million in December from 4.15 million in November, and are now 7.1% higher than last year. The median existing single-family home price was $226,000 in December, up 8.0% year-over-year.
"Although some growth is expected, the housing market will struggle in 2016 to replicate last year's 7% increase in sales," added Yun. "In addition to insufficient supply levels, the overall pace of sales this year will be constricted by tepid economic expansion, rising mortgage rates and decreasing demand for buying in oil-producing metro areas."
Regionally, increases abounded. However, the West led the charge by a long shot with an increase of 23.2%, followed by the South (14.6%).