WASHINGTON (July 22, 2015) — Existing-home sales increased in June to their highest pace in over eight years, while the cumulative effect of rising demand and limited supply helped push the national median sales price to an all-time high, according to the National Association of Realtors®. All major regions experienced sales gains in June and have now risen above year-over-year levels for six consecutive months.

Total existing-home sales¹, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 3.2 percent to a seasonally adjusted annual rate of 5.49 million in June from a downwardly revised 5.32 million in May. Sales are now at their highest pace since February 2007 (5.79 million), have increased year-over-year for nine consecutive months and are 9.6 percent above a year ago (5.01 million).

Lawrence Yun, NAR chief economist, says backed by June's solid gain in closings, this year's spring buying season has been the strongest since the downturn. "Buyers have come back in force, leading to the strongest past two months in sales since early 2007," he said. "This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy."

Adds Yun, "June sales were also likely propelled by the spring's initial phase of rising mortgage rates, which usually prods some prospective buyers to buy now rather than wait until later when borrowing costs could be higher."

The median existing-home price² for all housing types in June was $236,400, which is 6.5 percent above June 2014 and surpasses the peak median sales price set in July 2006 ($230,400). June's price increase also marks the 40^th consecutive month of year-over-year gains.

Total housing inventory³ at the end of June inched 0.9 percent to 2.30 million existing homes available for sale, and is 0.4 percent higher than a year ago (2.29 million). Unsold inventory is at a 5.0-month supply at the current sales pace, down from 5.1 months in May.

"Limited inventory amidst strong demand continues to push home prices higher, leading to declining affordability for prospective buyers," said Yun. "Local officials in recent years have rightly authorized permits for new apartment construction, but more needs to be done for condominiums and single-family homes."

The percent share of first-time buyers fell to 30 percent in June from 32 percent in May, but remained at or above 30 percent for the fourth consecutive month. A year ago, first-time buyers represented 28 percent of all buyers.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage rose in June to 3.98 from 3.84 percent in May, but remained just below 4.00 percent for the seventh straight month.

Properties typically stayed on the market for 34 days in June, down from May (40 days) and the shortest time since NAR began tracking in May 2011. Short sales were on the market the longest at a median of 129 days in June, while foreclosures sold in 39 days and non-distressed homes took 33 days. Forty-seven percent of homes sold in June were on the market for less than a month — the highest percentage since June 2013 (also 47 percent).

NAR President Chris Polychron, executive broker with 1^st Choice Realty in Hot Springs, Ark., says Realtors® are reporting drastic imbalances of supply in relation to demand in many metro areas — especially in the West. "The demand for buying has really heated up this summer, leading to multiple bidders and homes selling at or above asking price⁴," he said. "Furthermore, tight inventory conditions are being exacerbated by the fact that some homeowners are hesitant to sell because they're not optimistic they'll have adequate time to find an affordable property to move into."

Matching the lowest share since December 2009, all-cash sales were 22 percent of transactions in June, down from 24 percent in May and 32 percent a year ago. Individual investors, who account for many cash sales, purchased 12 percent of homes in June (14 percent in May) — the lowest since August 2014 (also 12 percent) and down from 16 percent in June 2014. Sixty-six percent of investors paid cash in June.

Distressed sales⁵ — foreclosures and short sales — fell to 8 percent in June (matching an August 2014 low) from 10 percent in May, and are below the 11 percent share a year ago. Six percent of June sales were foreclosures and 2 percent were short sales. Foreclosures sold for an average discount of 15 percent below market value in June (unchanged from May), while short sales were discounted 18 percent (16 percent in May).

Single-family and Condo/Co-op Sales

Single-family home sales increased 2.8 percent to a seasonally adjusted annual rate of 4.84 million in June from 4.71 million in May, and are now 9.8 percent above the 4.41 million pace a year ago. The median existing single-family home price was $237,700 in June, up 6.6 percent from June 2014 and surpassing the peak median sales price set in July 2006 ($230,900).

Existing condominium and co-op sales rose 6.6 percent to a seasonally adjusted annual rate of 650,000 units in June from 610,000 units in May, up 8.3 percent from June 2014 (600,000 units) and the highest pace since May 2007 (680,000 units). The median existing condo price was $226,500 in June, which is 5.5 percent above a year ago and the highest since August 2007 ($229,200).

Regional Breakdown

June existing-home sales in the Northeast climbed 4.3 percent to an annual rate of 720,000, and are now 12.5 percent above a year ago. The median price in the Northeast was $281,200, which is 3.9 percent higher than June 2014.

In the Midwest, existing-home sales rose 4.7 percent to an annual rate of 1.33 million in June, and are 12.7 percent above June 2014. The median price in the Midwest was $190,000, up 7.2 percent from a year ago.

Existing-home sales in the South increased 2.3 percent to an annual rate of 2.20 million in June, and are 7.3 percent above June 2014. The median price in the South was $205,000, up 7.2 percent from a year ago.

Existing-home sales in the West rose 2.5 percent to an annual rate of 1.24 million in June, and are 8.8 percent above a year ago. The median price in the West was $328,900, which is 9.9 percent above June 2014.

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NOTE: For local information, please contact the local association of Realtors® for data from local multiple listing services. Local MLS data is the most accurate source of sales and price information in specific areas, although there may be differences in reporting methodology.

¹Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR rebenchmarks home sales periodically using other sources to assess overall home sales trends, including sales not reported by MLSs.

Existing-home sales, based on closings, differ from the U.S. Census Bureau's series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which account for more than 90 percent of total home sales, are based on a much larger data sample — about 40 percent of multiple listing service data each month — and typically are not subject to large prior-month revisions.

The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.

²The median price is where half sold for more and half sold for less; medians are more typical of market conditions than average prices, which are skewed higher by a relatively small share of upper-end transactions. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if additional data is received.

The national median condo/co-op price often is higher than the median single-family home price because condos are concentrated in higher-cost housing markets. However, in a given area, single-family homes typically sell for more than condos as seen in NAR's quarterly metro area price reports.

³Total inventory and month's supply data are available back through 1999, while single-family inventory and month's supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90 percent of transactions and condos were measured only on a quarterly basis).

⁴According to NAR's Realtors® Confidence Index, roughly 38 percent of properties sold last month went at or above asking price, which is also the average for the past three months. Before April 2015, the average was 32 percent (since NAR began tracking this monthly data in December 2012).

⁵Distressed sales (foreclosures and short sales), days on market, first-time buyers, all-cash transactions and investors are from a monthly survey for the NAR's Realtors® Confidence Index, posted at Realtor.org.

NOTE: The Pending Home Sales Index for June will be released July 29, and Existing-Home Sales for July will be released August 20; release times are 10:00 a.m. EDT.

WASHINGTON (August 11, 2015) — A promising climb in home sales throughout the country amidst insufficient supply caused home prices to steadily rise in most metro areas during the second quarter, according to the latest quarterly report by the National Association of Realtors®.

The median existing single-family home price increased in 93 percent of measured markets¹, with 163 out of 176 metropolitan statistical areas² (MSAs) showing gains based on closings in the second quarter compared with the second quarter of 2014. Thirteen areas (7 percent) recorded lower median prices from a year earlier.

The number of rising markets in the second quarter increased compared to the first quarter, when price gains were recorded in 85 percent of metro areas. Thirty-four metro areas in the second quarter (19 percent) experienced double-digit increases, a decline from the 51 metro areas in the first quarter. Nineteen metro areas (11 percent) experienced double-digit increases in the second quarter of 2014.

Lawrence Yun, NAR chief economist, says the housing market has shifted into a higher gear in recent months. "Steady rent increases, the slow rise in mortgage rates and stronger local job markets fueled demand throughout most of the country this spring," he said. "While this led to a boost in sales paces not seen since before the downturn, overall supply failed to keep up and pushed prices higher in a majority of metro areas."

Adds Yun, "With home prices and rents continuing to rise and wages showing only modest growth, declining affordability remains a hurdle for renters considering homeownership — especially in higher-priced markets."

The national median existing single-family home price in the second quarter was $229,400, up 8.2 percent from the second quarter of 2014 ($212,000). The median price during the first quarter of this year increased 7.1 percent from a year earlier.

The five most expensive housing markets in the second quarter were the San Jose, Calif., metro area, where the median existing single-family price was $980,000; San Francisco, $841,600; Anaheim-Santa Ana, Calif., $685,700; Honolulu, $698,600; and San Diego, $547,800.

The five lowest-cost metro areas in the second quarter were Cumberland, Md., where the median single-family home price was $82,400; Youngstown-Warren-Boardman, Ohio, $85,000; Rockford, Ill., $94,700; Decatur, Ill., $96,000; and Elmira, N.Y., $98,300.

Total existing-home sales³, including single family and condo, increased 6.6 percent to a seasonally adjusted annual rate of 5.30 million in the second quarter from 4.97 million in the first quarter, and are 8.5 percent higher than the 4.89 million pace during the second quarter of 2014.

"The ongoing rise in home values in recent years has greatly benefited homeowners by increasing their household wealth," says Yun. "In the meantime, inequality is growing in America because the downward trend in the homeownership rate means these equity gains are going to fewer households."

At the end of the second quarter, there were 2.30 million existing homes available for sale⁴, slightly above the 2.29 million homes for sale at the end of the second quarter in 2014. The average supply during the second quarter was 5.1 months — down from 5.5 months a year ago.

Metro area condominium and cooperative prices — covering changes in 61 metro areas — showed the national median existing-condo price was $217,400 in the second quarter, up 3.1 percent from the second quarter of 2014 ($210,800). Fifty metro areas (82 percent) showed gains in their median condo price from a year ago; 11 areas had declines.

Rising home prices weighed on affordability in the second quarter compared to the second quarter of last year despite an uptick in the national family median income ($66,637)⁵. To purchase a single-family home at the national median price, a buyer making a 5 percent downpayment would need an income of $49,195, a 10 percent downpayment would require an income of $46,605, and $41,427 would be needed for a 20 percent downpayment.

NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark., says Realtors® are reporting strong competition and limited days on market for available homes — especially at the entry-level price range. "Buyers should work with their Realtor® to deploy a negotiation strategy that helps their offer stand out," he said. "If a bidding war occurs, it's important for the buyer to stay patient and only counteroffer up to what he or she can comfortably afford. It's better to walk away and wait for the right home instead of being in a situation where one has purchased a home above their means."

Regional Breakdown

Total existing-home sales in the Northeast increased 10.3 percent in the second quarter and are 8.6 percent above the second quarter of 2014. The median existing single-family home price in the Northeast was $269,300 in the second quarter, up 5.2 percent from a year ago.

In the Midwest, existing-home sales jumped 13.4 percent in the second quarter and are 12.7 percent higher than a year ago. The median existing single-family home price in the Midwest increased 8.7 percent to $182,000 in the second quarter from the same quarter a year ago.

Existing-home sales in the South fell rose 1.1 percent in the second quarter and are 6.3 percent above the second quarter of 2014. The median existing single-family home price in the South was $202,900 in the second quarter, 8.7 percent above a year earlier.

In the West, existing-home sales climbed 8.1 percent in the second quarter and are 8.1 percent above a year ago. The median existing single-family home price in the West increased 9.6 percent to $325,200 in the second quarter from the second quarter of 2014.

The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

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NOTE: NAR releases quarterly median single-family price data for approximately 170 Metropolitan Statistical Areas (MSAs). In some cases the MSA prices may not coincide with data released by state and local Realtor® associations. Any discrepancy may be due to differences in geographic coverage, product mix, and timing. In the event of discrepancies, Realtors® are advised that for business purposes, local data from their association may be more relevant.

Data tables for MSA home prices (single family and condo) are posted at http://www.realtor.org/topics/metropolitan-median-area-prices-and-affordability. If insufficient data is reported for a MSA in particular quarter, it is listed as N/A. For areas not covered in the tables, please contact the local association of Realtors®.

¹The Ann Arbor, MI MSA and Harrisburg-Carlisle, PA MSA will now be included in the single-family price report.

²Areas are generally metropolitan statistical areas as defined by the U.S. Office of Management and Budget. NAR adheres to the OMB definitions, although in some areas an exact match is not possible from the available data. A list of counties included in MSA definitions is available at: http://www.census.gov/population/estimates/metro-city/List4.txt.

^{Regional median home prices are from a separate sampling that includes rural areas and portions of some smaller metros that are not included in this report; the regional percentage changes do not necessarily parallel changes in the larger metro areas. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Quarter-to-quarter comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns.}

^{Median price measurement reflects the types of homes that are selling during the quarter and can be skewed at times by changes in the sales mix. For example, changes in the level of distressed sales, which are heavily discounted, can vary notably in given markets and may affect percentage comparisons. Annual price measures generally smooth out any quarterly swings.}

^{NAR began tracking of metropolitan area median single-family home prices in 1979; the metro area condo price series dates back to 1989.}

^{Because there is a concentration of condos in high-cost metro areas, the national median condo price often is higher than the median single-family price. In a given market area, condos typically cost less than single-family homes. As the reporting sample expands in the future, additional areas will be included in the condo price report.}

³The seasonally adjusted annual rate for a particular quarter represents what the total number of actual sales for a year would be if the relative sales pace for that quarter was maintained for four consecutive quarters. Total home sales include single family, townhomes, condominiums and co-operative housing.

^{Seasonally adjusted rates are used in reporting quarterly data to factor out seasonal variations in resale activity. For example, sales volume normally is higher in the summer and relatively light in winter, primarily because of differences in the weather and household buying patterns.}

⁴Total inventory and month's supply data are available back through 1999, while single-family inventory and month's supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90 percent of transactions and condos were measured only on a quarterly basis).

⁵Income figures are rounded to the nearest hundred, based on NAR modeling of Census data. Qualifying income requirements are determined using several scenarios on downpayment percentages and assume 25 percent of gross income devoted to mortgage principal and interest at a mortgage interest rate of 4.0%.

NOTE: Existing-Home Sales for July will be released August 20, and the Pending Home Sales Index for July will be released August 27; release times are 10:00 a.m. EDT.