US dwelling gross sales bounce in February, ending 12-month slide

WASHINGTON: Gross sales of present houses in the US made their largest month-to-month bounce since 2020 in February, ending a 12 months of declines in accordance with trade information launched on Tuesday.
Because the US central financial institution raised rates of interest steeply over the previous 12 months to curb surging inflation, the rate-sensitive housing market has been reeling.
However final month, present dwelling gross sales rose 14.5 p.c from January to a seasonally adjusted annual charge of 4.58 million, mentioned the Nationwide Affiliation of Realtors (NAR) in a press release.
In contrast with a 12 months in the past nevertheless, gross sales have been nonetheless down by 22.6 p.c, the NAR mentioned.
“Acutely aware of adjusting mortgage charges, dwelling patrons are profiting from any charge declines,” added NAR chief economist Lawrence Yun in a press release.
He added that gross sales are stronger in areas the place dwelling costs are falling and native economies are including jobs.
Based on dwelling mortgage finance firm Freddie Mac, the favored 30-year fixed-rate mortgage averaged 6.6 p.c as of March 16, down from the week earlier than.
Current dwelling gross sales make up the overwhelming majority of the US property market.
“Mortgage charges stay excessive though they’ve come off current peaks,” mentioned Excessive Frequency Economics chief US economist Rubeela Farooqi in a be aware.
“However affordability stays a key constraint for patrons,” she mentioned.
Kieran Clancy, senior US economist at Pantheon Macroeconomics, added: “A dramatic enchancment in affordability remains to be wanted earlier than gross sales can get well.”
The median dwelling value throughout housing varieties was down barely from a 12 months in the past at $363,000, mentioned the NAR.
However Yun added that “stock ranges are nonetheless at historic lows.”
Month-over-month gross sales picked up in all 4 main US areas.
As of end-February, whole housing stock was 980,000 items, equivalent to January and up from a 12 months in the past, mentioned the affiliation.
“Unsold stock sits at a 2.6-month provide on the present gross sales tempo,” the NAR famous.
Nancy Vanden Houten, lead US economist at Oxford Economics, cautioned: “We count on dwelling gross sales to return underneath renewed strain within the months forward, with a recession within the second half of the 12 months additionally weighing on dwelling gross sales.”

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