Sales of existing homes jumped nearly 5 percent in May to an annualized rate of 4.9 million, the biggest monthly increase in nearly three years.
May’s sales volume, however, was 5 percent below what it was a year earlier,according to the National Association of Realtors.
Stlll, the strong report was good news for the housing industry.
“Home buyers are benefiting from slower price growth due to the much-needed rising inventory levels seen since the beginning of the year,” said NAR Chief EconomistLawrence Yun. “Moreover, sales were helped by the improving job market and the temporary but slight decline in mortgage rates.”
The median existing-home price in May was $213,400, which is 5 higher than a year ago.
Yun said more new home construction is needed to boost the housing market’s inventory.
Another issue facing the housing market: Only 27 percent of buyers in May were first-time buyers.
That percentage could improve if interest rates stay where they are and inventory improves, said NAR President Steve Brown, co-owner of Irongate Inc. Realtors in Dayton, Ohio. This would mean buyers would have a better chance “make a competitive offer that’s in return accepted by the seller,” he said.