Sales of already-built existing homes increased in September in each of the four major regions monitored by the National Association of Realtors (NAR) [1].
According to a new report published by the NAR, total existing home sales (which includes single-family homes, townhomes, condominiums, and co-ops) rose 7.0% from August to a seasonally adjusted annual rate of 6.29 million units in September, but was down 2.3% year-over-year from 6.44 million units in 2020.
"Some improvement in supply during prior months helped nudge up sales in September," said Lawrence Yun [2], NAR's chief economist. "Housing demand remains strong as buyers likely want to secure a home before mortgage rates increase even further next year."
Total housing inventory in September was 1.27 million units, down 0.8% since last month and 13% since last year. The unsold inventory is a 2.4-month supply in the current market, down 7.7% from last month and down from last years 2.7 months.
The NAR also found that the average price for any type of existing housing was $352,800, up 13.3% year-over-year as prices rose in each of NARs regions. This was the 115th month of year-over-year increases.
But while Yun believes that the current problems with labor and the national supply chain are impacting the market, he remains confident that the current inventory of homes will increase over the next few months.
"As mortgage forbearance programs end, and as homebuilders ramp up production—despite the supply-chain material issues—we are likely to see more homes on the market as soon as 2022," said Yun.
The report found that the average length of time a house was on the market in September was 17 days, steady from last month and down four days from last year. First time buyers also accounted for 28% of sales in September, down 1% from August and 3% since last year.
"First-time buyers are hit particularly hard by the historically high home prices as they largely do not have the savings required to buy a home or equity to offset such a purchase," said Yun.
The majority of cash sales are made by investors or people who purchase second homes which represented 13% of home sales in September, off 2% from August. All-cash sales accounted for 23% of transactions in September, up from both 22% in August and from 18% in September 2020.
In addition, the report said that distressed sales represent less than 1% of the market and remained steady with both last month and year.
Breaking down the data regionally:
- Existing-home sales in the Northeast grew 5.5% in September, posting an annual rate of 770,000, an 8.3% decrease from September 2020. The median price in the Northeast was $387,200, up 9.2% from one year ago.
- Existing-home sales in the Midwest rose 5.1% to an annual rate of 1,440,000 in September, a 2.7% drop from a year ago. The median price in the Midwest was $265,300, a 9.1% increase from September 2020.
- Existing-home sales in the South jumped 8.6% in September, recording an annual rate of 2,770,000, unchanged from one year ago. The median price in the South was $307,500, a 14.8% rise from one year ago.
- Existing-home sales in the West climbed 6.5%, registering an annual rate of 1,310,000 in September, down 3.0% from one year ago. The median price in the West was $506,300, up 8.3% from September 2020.