U.S. existing-home sales rose 3.2% to a seasonally adjusted annual rate of 4.17 million in May, up from 4.02 million in April, the National Association of Realtors announced. The increase, which exceeded economist forecasts of 4.07 million, was driven by improving affordability as mortgage rates remained lower than a year ago and income gains outpaced home price growth in most regions. The data prompted a modest sell-off in gold, with spot prices trading at $4,326.50 per ounce, roughly unchanged on the day, as the housing market's stabilization reduced demand for safe-haven assets.
Existing-Home Sales Surpass Economist Forecasts in May
Total existing-home sales, including single-family homes, townhomes, condominiums, and co-ops, reached 4.17 million in May, according to the National Association of Realtors. Consensus estimates from economists had projected a smaller increase to 4.07 million. The report noted that home sales were also up 3.2% year over year.
NAR Economist Attributes Sales Momentum to Affordability Gains
Dr. Lawrence Yun, NAR Chief Economist, stated that the increase marked the highest sales level since December. "More Americans are on the move, with home sales rising to the highest level since December. This is great news for the housing market and the economy," Yun said. "Improving affordability is helping drive this momentum. Even with mortgage rates ticking up compared to earlier in the year, they remain lower than a year ago and are essentially at the long-term historical average. Income gains are also outpacing home price growth by a small margin in most parts of the country."
Yun noted that the housing market appeared to be on solid footing after difficult years. "Only 1% of all home sales involved a foreclosure or an underwater situation in which the sale price could not cover the outstanding mortgage balance. This shows that homeowners are on solid financial footing," he said. The U.S. housing market had struggled in recent years as elevated interest rates kept mortgage rates high, while limited supply pushed prices higher.
Housing Inventory Rises as Median Price Reaches $429,300
As of the end of May, the market had a supply of 1.55 million homes for sale, up 3.3% from April. The inventory represented a 4.5-month supply. The median price for all existing housing types was $429,300 in May, an increase of 1.3% from a year ago, marking another record high.
FAQ
What was the U.S. existing-home sales figure for May?
U.S. existing-home sales rose 3.2% to a seasonally adjusted annual rate of 4.17 million in May, up from 4.02 million in April, according to the National Association of Realtors.
Why did existing-home sales increase in May?
NAR Chief Economist Dr. Lawrence Yun attributed the sales momentum to improving affordability, with mortgage rates remaining lower than a year ago and income gains outpacing home price growth in most parts of the country.
What is the current median price for existing homes?
The median price for all existing housing types was $429,300 in May, an increase of 1.3% from a year ago, marking another record high.
