The sale of existing homes increased in April, but sales still are not meeting underlying demand, the National Association of Realtors reported May 22. NAR said home sales could be higher if it weren’t for limited inventory and tight credit standards.
NAR reported that April sales of existing-homes (including single-family, townhomes, condominiums and co-ops) rose 0.6 percent to a seasonally adjusted rate of 4.97 million, which is up 9.7 percent from April 2012.
Lawrence Yun, chief economist for NAR, said that the housing market recovery is solid despite tight access to credit and limited inventory. He noted that if those barriers were removed, sales of existing home sales would easily go over 5 million units per month.
Yun said buyer traffic is 31 percent stronger than in April 2012, yet sales have increased only about 10 percent. “It’s become quite clear that the only way to tame price growth to a manageable, healthy pace is higher levels of new home construction,” Yun noted.
Existing-home sales are running at the highest pace since November 2009 when buyers were responding to the first-time homebuyer tax credit. April is the 22nd consecutive month of year-over-year sales gains and the 14th consecutive month of year-over-year price gains.
Inventory has moved up slowly to 2.16 million existing homes for sale, which represents a 5.2-month supply at the current sales pace. Median sales prices are up 11 percent year-over-year, averaging $192,800.
The median length of time that homes remained on the market in April was 46 days, NAR reported. That’s an improvement from March when homes averaged 62 days. In April 2012, homes remained on the market an average 83 days.
NAR data showed that first-time homebuyers made up 29 percent of purchases in April compared to 35 percent in April 2012.