Existing Home Sales Surge in U.S.: Comprehensive Analysis

7 Days Free Trial

for Enterprise Subscriptions

Trusted by 250,000+ Professionals for Continuing Education

Create Your Account 1/2

Already have an account? Log In

First Name

Last Name

Phone

Company Name

Password

Confirm Password

Promo Code

I Accept myCPE Terms and Conditions

You can cancel anytime during your trial period.

Become a Valued Member of myCPE Professionals Community

Trusted by 250,000+ Professionals

"Steven was knowledgeable and thorough…”

Steven was knowledgeable and thorough in his information about the product and what is offered. He was empathetic to my situation. He went above and beyond answering all of my many questions. Excellent service!

Crystal lovejoy

"Great Customer Service”

Great service and very patient as I asked several questions. Steven answered all my questions and helped me make the right decision in my subscription purchase. Thank you.

Lori corry

"It is what it advertised to be”

It is what it advertised to be. Professional quality training and CPE tracking and certificates; systems knows AZ CPA CPE requirements and categories. I've needed help on several occasions and the assistance was quick and effective; however, there were some problems with data entry. The assistance sometimes asks for input, but when I try to type it is dissallowed for some reason. On several occasions I had to close the popup to get it out of my way.

Brian Carey

"Great customer service”

Great customer service. Classes are pertinent. Great value

Steve

1/4

Create Your Free Account

First Name

Last Name

Email Address

Password

Confirm Password

Continue

Already have an account? Log In

Card No.

Card Holder Name

Expiry Date

CVV

Address

Address 2 (Optional)

Zip Code

I Accept myCPE Terms and Conditions

Guaranteed safe & secure checkout

Pay $199

Inside This Article

The U.S. housing market witnessed a significant surge in existing home sales in February 2024, marking a remarkable shift in market dynamics that could influence the spring selling season. However, it's important to note that existing home sales were still slightly lower compared to February 2023. This detailed article aims to unravel the complexities of the housing market, offering insights into the factors contributing to this upward trend and what it signifies for potential buyers, sellers, and the economy at large.

Understanding the Seasonally Adj. Annual Rate (SAAR)

This term refers to the rate at which homes are selling on an annual basis, adjusted for seasonal fluctuations. In February 2024, the SAAR for existing home sales reached 4.38 million units, the highest level since the previous year.

Key Key Factors

Several factors have converged to catalyze the increase in home sales, offering a beacon of hope for the U.S. housing market:

Improved Housing Supply: A 5.9% month-on-month increase in housing inventory, rising to 1.07 million units, has played a crucial role. This supply uptick is attributed to enhanced single-family homebuilding and housing completions.
Retreating Mortgage Rates: Following a period of volatility, mortgage rates have shown signs of stabilization, hovering around 6.74% for 30-year fixed-rate loans in mid-March. This relative stability, compared to recent hikes, has contributed to the attractiveness of homeownership, particularly for first-time buyers.
The Federal Reserve's Influence: The Federal Reserve's decision to maintain its policy rate in March likely fostered a more conducive environment for potential buyers by keeping borrowing costs somewhat stable.

The Regional Regional Perspective Increases

The increase in existing home sales has not been uniform across the board, with notable variations across regions:

South and Midwest Lead: Both regions, known for their relatively affordable housing markets, witnessed robust sales activity, with increases of 9.8% and 8.4%, respectively, from January.
West Sees Unprecedented Growth: The West experienced a remarkable 16.4% month-on-month sales surge, highlighting a dynamic market recovery in the region.
Northeast Remains Steady: Despite stagnant sales growth compared to January, the Northeast saw the highest price gains (11.5%), indicating a competitive seller's market.

Mortgage Rates and Home Affordability

Mortgage rates play a crucial role in affordability and significantly influence home-buying decisions. While the 30-year fixed-rate mortgage averaged 6.74% in mid-March, a slight decrease from the previous week, rates remain higher compared to a year ago. This might influence some buyers' purchasing power.

The percentage of first-time buyers also saw a slight dip, dropping to 26% of sales in February compared to 28% in January. This could be due to affordability concerns or a shift in buyer demographics.

On the other hand, all-cash sales continued to rise, reaching 33% of transactions in February. This might be attributed to investors or second-home buyers, who are less impacted by mortgage rates.

What Does it Mean for You? The February data suggests a cautiously optimistic outlook for the US housing market. While sales figures are encouraging, affordability remains a concern due to rising prices and mortgage rates.

Existing Home Sales by Region : A Snapshot by Region

To better understand the current state of the market across different regions, let's examine the data in table format:

This table offers a snapshot of how each region has fared in terms of sales activity and price dynamics, illustrating the uneven recovery and growth across the U.S. The South and Midwest witnessed the most significant gains in sales in January, while the West saw a remarkable surge. However, compared to February 2023, all regions except the Northeast experienced a slight decrease in sales.

Inventory on the Rise - A Sign of Relief?

Another positive development is the increase in housing inventory. February saw a 5.9% jump compared to January and a 10.3% increase year-over-year. This indicates more options

for buyers, potentially leading to a less competitive market in the future. However, it's important to note that the current inventory level still translates to a 2.9-month supply at the current sales pace. A balanced market typically has a 6-month supply.

Persistent Price Growth

Despite the increase in inventory, median existing home prices continued their upward trajectory. The national median price reached $384,500, reflecting a 5.7% increase over February 2023. All regions across the US experienced price growth.

Key Concepts for General Understanding

Existing Home Sales: This term refers to the sale of previously owned single-family homes, condominiums, townhomes, and co-ops, as opposed to new construction. It's a critical indicator of housing market health and economic activity.
Inventory Levels: This represents the total number of available homes for sale at any given time. Low inventory levels can lead to competitive markets, often resulting in price increases.

Way Ahead: A Market in Transition

The recent increase in existing home sales, bolstered by an improving supply situation and more favorable mortgage rates, presents a mixed bag of opportunities and challenges. While the uptick is a positive sign of market recovery, regional disparities and below-pre-pandemic inventory levels highlight ongoing constraints.

As we look forward to the spring selling season, potential buyers and sellers must navigate this complex landscape with informed strategies and realistic expectations. The current trends underscore the importance of monitoring market indicators, such as inventory levels and mortgage rates, to make well-informed decisions in the dynamic U.S. housing market.

This article is brought to you by www.my-cpe.com

About MY-CPE

MY-CPE is a top-notch continuing education platform known for getting tax updates to its professionals super fast, usually in under 48 hours, with the help of 700+ Instructors.

With a reach of 250,000+ accounting and tax professionals, MY-CPE has become a go-to resource.

Whether it's training on tax preparation, the latest tax updates, or the core technical tax concepts, MY-CPE is the first pick for tax and accounting professionals. Our USP - is offering all quality courses through a subscription at highly affordable rates, unlike other platforms that charge by the course.

Check Out Subscription Plans

Go with MY-CPE to stay ahead in your game.

Share with

Allen Smith

Learning Consultant

The Authors, Allen Smith is a Practicing Certified public accountant and senior vice president at MYCPE ONE – Continuing Education Platform for Professionals. He understands the current needs of the education domain and strategies for the presenters to adapt the new changes.