Home prices show one of the strongest annual price gains in 8 years

25 Sep

Existing-home sales in August reached their highest level in six years according to the National Association of Realtors (NAR).

 

Total existing-home sales rose 1.7% to a seasonally adjusted annual rate of 5.48 million in August. This was an increase from July’s 5.39 million, and 13.2% higher year-over-year compared to August 2012.

 

Total housing inventory at the end of August increased 0.4% to 2.25 million existing homes available for sale. This figure represents a 4.9-month supply at the current sales pace, down from a 5.0-month supply in July.

 

Meanwhile, the national average commitment rate for a 30-year conventional fixed-rate mortgage rose to 4.46% in August, and is the highest since July 2011 when it was 4.55%. In August 2012, the rate was 3.60%.

The national median existing-home price for all housing types was $212,100 in August, up 14.7% from year ago levels, and the strongest year-over-year appreciation since October 2005, when the median price rose 16.6%.

 

August’s home price increase was also the ninth consecutive month of double-digit year-over-year increases, and marks 18 consecutive months of annual gains.

 

Rising home values will encourage more people to sell as homeowners’ equity continues to improve, says NAR President Gary Thomas.

 

“Most of those owners also will be buying another home, but higher levels of new home construction going into 2014, combined with some reduction in demand from less favorable affordability conditions, will help to moderate price growth to more sustainable levels,” he said.

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