Coming off a strong last couple months of 2012, housing market factors continued to improve in February, with existing homes sales growing for the 20th consecutive month and home prices pushing forward when compared to those recorded last year.
In a monthly report from the National Association of Realtors, it was revealed that existing-home sales rose a modest 0.8 percent to a seasonally adjusted rate of 4.98 million from 4.94 million in January. Despite being less than a 1 percent improvement, sales were 10.2 percent higher than the level seen in February last year, when the annual rate was 4.52 million. NAR noted that sales in the second month of the new year were the highest seen since November 2009 when buyers were hustling to make the investment in exchange for a significant tax credit that expired in December.
Economic improvements, including a rise in job opportunities throughout much of the country are credited with the jump in home sales, while many economists also say that built up demand will continue to contribute to rising figures in coming months. This will likely occur when more properties are listed for sale throughout the busier months for real estate transactions in the spring and summer. Additionally, many more buyers may find themselves relocating for jobs.
The national inventory by the end of the month had increased 9.6 percent to 1.94 million, according to mortgage records, a 4.7 month supply. this is up from 4.3 months recorded the previous month but a significant 12.9 percent below the level seen in February last year.
While higher home prices may not sound like a positive housing market factor for those looking to score a deal, the 11.6 year-over-year improvement indicate the housing market is becoming more stable. According to NAR, the national median price of existing homes was $173,600. This has been the largest annual gain in home values since November 2005, before the downturn of the industry and the start of the recession.
"A strong rise in home values is contributing to housing wealth recovery, which has risen by $1.4 trillion in the past year and looks to top that increase this year," said Lawrence Yun, chief economist of NAR. "The extra consumer spending arising from growth in housing wealth is expected to be $70 billion to $110 billion this year."
While some factors may be on the rise, mortgage rates are still near record lows, and recently posted notable declines as seen in Freddie Mac's Primary Mortgage Market Survey for the week ending March 21.