Existing-Home Sales Spike in July

WASHINGTON (August 21, 2013) ? Existing-home sales rose strongly in July, with the median price maintaining double-digit year-over-year increases, according to the National Association of Realtors?.

Total existing-home sales1, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 6.5 percent to a seasonally adjusted annual rate of 5.39 million in July from a downwardly revised 5.06 million in June, and are 17.2 percent above the 4.60 million-unit pace in July 2012; sales have remained above year-ago levels for 25 months.

Lawrence Yun, NAR chief economist, said changes in affordability are impacting the market. ?Mortgage interest rates are at the highest level in two years, pushing some buyers off the sidelines,? he said. ?The initial rise in interest rates provided strong incentive for closing deals. However, further rate increases will diminish the pool of eligible buyers.?

Despite higher mortgage interest rates, Yun identified compensating factors that can sustain a continued recovery. ?Although housing affordability conditions will become less attractive, jobs are being added to the economy, and mortgage underwriting standards should normalize over time from current stringent conditions as default rates fall.?? READ MORE

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