Home sales in the U.S. grew in October as buyers continue to enter a hot market, according to the National Association of Realtors.
Existing home sales increased at the fastest pace since January, growing 0.8% in October from the previous month to a seasonally adjusted rate of 6.34 million, the National Association of Realtors (NAR) reported Monday. October home sales declined 5.8% compared to the figure in October 2020, with the inventory of unsold homes decreasing 12% to 1.25 million on a year-over-year basis.
“Home sales remain resilient, despite low inventory and increasing affordability challenges,” Lawrence Yun, NAR’s chief economist, said in the report. “Inflationary pressures, such as fast-rising rents and increasing consumer prices, may have some prospective buyers seeking the protection of a fixed, consistent mortgage payment.”
High prices scared off some buyers, according to The Wall Street Journal, with the median existing home prices jumping 13.1% to $253,900 in October on a year-over-year basis, according to the NAR report. Home sales usually dip as summer ends because buyers are hesitant to move during the school year and are scared off by the cold weather during the holiday season.
“Looking ahead, we expect existing home sales to trend sideways over the final two months of the year as the market navigates familiar headwinds in the form of limited supply and declining affordability and tailwinds from resilient demand and accommodative mortgage rates,” Mahir Rasheed, U.S. economist at Oxford Economics, told the Daily Caller News Foundation.
“Among some of the workforce, there is an ongoing trend of flexibility to work anywhere, and this has contributed to an increase in sales in some parts of the country,” Yun said. “Record-high stock markets and all-time high home prices have worked to significantly raise total consumer wealth and, when coupled with extended remote work flexibility, elevated housing demand in vacation regions.”
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