Existing Home Sales Jump to 14-Year High and Set Record Prices
September 22, 2020
The housing market continues its hot streak, with August following July’s lead in breaking records. Sales of existing homes were up 2.4% for the month for a seasonally adjusted annual rate of 6 million units, according to the National Association of Realtors. Sales were up 10.5% over the same month last year, and hit the highest pace since December 2006, before the financial crisis.
It is possible that even more homes could have sold if inventory weren’t constrained. The supply of homes was down 18.6% annually, with just 1.49 million homes for sale at the end of the month. When the previous record was set in 2006, there was more than double the current supply.
The small supply and big demand drove prices to a record high. The median price of a home sold in August was $310,600, an annual increase of 11.4%.
The rate of sales is expected to slow in September, as wildfires and hurricanes have diminished an already low inventory, and we move out of the summer buying season. Because of the constrained supply, however, prices are expected to remain high.