Home prices, sales start to climb in May
Posted on Tuesday, June 24, 2014 at 8:58:05 AM
A number of factors can constrict homebuying activity, from high residential financing rates to a lack of inventory and rapid price growth. However, few of those conditions were present this past month.
According to the National Association of Realtors, existing-home sales, which cover several property types, including single-family homes, ticked up in May. Compared to April, sales increased 4.9 percent, although they are still 5 percent lower than May 2013's levels.
"Homebuyers are benefiting from slower price growth due to the much-needed, rising inventory levels seen since the beginning of the year," explained NAR chief economist Lawrence Yun. "Moreover, sales were helped by the improving job market and the temporary but slight decline in mortgage rates."
He added that while rising inventory is good, new home construction must increase as well to continue to bolster the housing market.
In addition, home prices across the country have also surged in May. According to Black Knight Financial Services, national prices climbed 0.9 percent for the month, which also represents a 6.4 percent year-over-year uptick. Georgia and Massachusetts led the pack for monthly gains, while Austin, Texas, is tied with San Francisco as the biggest state movers.