Existing home sales increased in November to a seasonally adjusted annual rate of 6.46 million, marking the third consecutive month of growth, according to the latest monthly report from the National Association of Realtors (NAR). Total existing home sales, which include single-family homes, townhomes, condos, and co-ops, increased 1.9% from October to November but are down 2% from November 2020.
“Determined buyers were able to land housing before mortgage rates rise further in the coming months.” says NAR chief economist Lawrence Yun. “Locking in a constant and firm mortgage payment motivated many consumers who grew weary of escalating rents over the last year.”
Yun forecasts the 30-year fixed mortgage rate will average at 3.7% by the end of the calendar year in 2022.
Total housing inventory at the end of November totaled 1.11 million units, down 9.8% from October and down 13.3% on a year-over-year (YOY) basis. Unsold inventory sits at a 2.1-month supply at the current sales pace, a decline on both a monthly and YOY basis.
The median existing home price for all housing types in November was $353,900, a 13.9% increase from November 2020. The NAR said prices have increased in each region, with the South experiencing the highest pace of price appreciation. The year-over-year increase in November 2021 marks the 117th consecutive month of YOY increases in prices, the longest-running streak on record, according to the NAR.
Properties typically remained on the market for 18 days in November, level with October but down from 21 days in November 2020. Eighty-three percent of homes sold in November were on the market for less than a month, according to the NAR.
“Supply chain disruptions for building new homes and labor shortages have hindered bringing more inventory to the market,” says Yun. “Therefore, housing prices continue to march higher due to the near record-low supply levels.”
First-time buyers were responsible for 26% of sales in November, down from 29% in October and from 32% in November 2020. Individual investors or second-home buyers, who make up many cash sales, purchased 15% of homes in November, down from 17% in October but up from 14% a year ago. All-cash sales accounted for approximately 24% of transactions in November, on par with October and up from 20% in November 2020. Distressed sales, foreclosures and short sales, represented less than 1% of sales in November, the same percentage seen in both October and November 2020.
Single-family home sales rose to a seasonally adjusted annual rate of 5.75 million in November, up 1.6% from October and down 2.2% on a YOY basis. The median existing single-family home price was $362,600 in November, up 14.9% from November 2020.
Existing home sales increased on a monthly basis in three of the four major U.S. regions, with sales in the Northeast holding steady compared with October. On a YOY basis, only one region experienced a sales increase, while the other three regions saw home sales decline.
Existing home sales in the Northeast were flat compared with October and decreased 11.6% on a YOY basis. Sales in the Midwest increased 0.7% from October and decreased 0.7% on a YOY basis. Existing sales in the South grew 2.9% from October and 1.1% compared with November 2020. Sales in the West increased 2.3% compared with October and decreased 3.9% on a YOY basis.
