U.S. home sales hit a seven-year high in 2013, rising to their highest levels since the peak of the housing boom, data from the NATIONAL ASSOCIATION OF REALTORS® shows.
The median home price reached $197,100 in 2013, up 11.5% from 2012, NAR says.
Sales of single-family homes, townhomes, condominiums, and co-ops increased 9.1% in 2013 when 5.09 million homes changed hands. That’s the housing market’s strongest performance since 2006 when sales reached 6.48 million at the close of the housing boom.
NAR Chief Economist Lawrence Yun said housing has experienced a healthy recovery over the past two years. “Existing-home sales have risen nearly 20% since 2011, with job growth, record low mortgage interest rates, and a large pent-up demand driving the market,” he said. “We lost some momentum toward the end of 2013 from disappointing job growth and limited inventory, but we ended with a year that was close to normal given the size of our population.”
Monthly Home Prices
Looking at just December, the median existing-home price was $198,000, up 9.9% from December 2012.
Fourteen percent of December sales were distressed homes, including foreclosures and short sales. That’s down substantially from December 2012, when 24% of sales were distressed.
That shrinking share of distressed sales accounts for some of the growth in median home prices. Foreclosures sold for an average discount of 18% below market value in December, while short sales were discounted 13% in December.
How’s the Inventory of Homes for Sale?
Housing inventory at the end of December fell 9.3%, to 1.86 million existing homes available for sale. At the current sales pace, it would take 4.6 months to sell them. That’s down from 5.1 months in November. The typical home was on the market for a median 72 days, up from 56 days in November.
Adverse weather reportedly delayed closings in many areas. Twenty-eight percent of homes sold in December were on the market for less than a month, down from 35% in November, which appears to be a weather impact.
Short sales were on the market for a median of 122 days in December, while foreclosures typically sold in 67 days and non-distressed homes took 70 days.
What’s Ahead for the Housing Market?
With the job market expected to improve this year, sales should hold steady despite rising home prices and mortgage interest rates, said NAR President Steve Brown. “The only factors holding us back from a stronger recovery are the ongoing issues of restrictive mortgage credit and constrained inventory. With strict new mortgage rules in place, we’ll be monitoring the lending environment to ensure that financially qualified buyers can access the credit they need to purchase a home,” he said.
Visit HouseLogic.com for more articles like this. Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®