The housing market has been heating up over the summer, with both pending and existing home sales posting their strongest showings of the year in July.
The National Association of Realtors (NAR) reported today that its index of pending home sales rose 3.3 percent in July, hitting its highest seasonally adjusted level since August of 2013. Pending sales have now risen in four of the past five months.
Likewise, completed sales of existing homes were up 2.4 percent in July and have now increased for four straight months, the NAR recently reported. July sales were at a seasonally adjusted rate of 5.15 million units, the highest pace of 2014, although still trailing the July 2013 pace of 5.38 million, which was last year's highest mark.
Employment, interest rates help boost sales
NAR chief economist Lawrence Yun cited improving employment figures and an increasing inventory of homes available for sale as factors behind the recent rise.
"The number of houses for sale is higher than a year ago and tamer price increases are giving prospective buyers less hesitation about entering the market," he recently said. "More people are buying homes compared to earlier in the year and this trend should continue with interest rates remaining low and apartment rents on the rise."
Lower interest rates have also been a factor, he said. Mortgage rates are now lower than they were at this time one year ago. Meanwhile, the improving job market is giving people more confidence to commit to a home purchase.
Homes continue to sell fairly quickly. The median time on the market for all homes sold in July was 48 days, slightly longer than in June but still relatively prompt by historic standards. Forty percent of all homes sold in July were on the market for less than a month.
The median single-family home sold for $223,900 in July, a 5.3 percent increase over July 2013; the median existing condo price was $215,000, up 3.3 percent from one year ago.