(AXcess News) Washington – Existing home sales were flat in January, following a downward revised December. Data shows that on an annual rate existing home sales were 4.92 million, a 0.4% increase over December’s 4.9 million.
While the market wasn’t surprised by flat home sales data, the Dow gave up more than 53 points in late-morning trading in New York.
The National Association of Realtors (NAR) chief economist Lawrence Yun said inventory levels of existing homes for sale was tightening and believed that growing demand would continue to boost sales and ultimately, prices.
“Buyer traffic is continuing to pick up, while seller traffic is holding steady, “ he said. “In fact, buyer traffic is 40 percent above a year ago, so there is plenty of demand but insufficient inventory to improve sales more strongly. We’ve transitioned into a seller’s market in much of the country.”
Total housing inventory at the end of January fell 4.9 percent to 1.74 million existing homes available for sale, which represents a 4.2-month supply at the current sales pace, down from 4.5 months in December, and is the lowest housing supply since April 2005 when it was also 4.2 months.
Listed inventory is 25.3 percent below a year ago when there was a 6.2-month supply. Raw unsold inventory is at the lowest level since December 1999 when there were 1.71 million homes on the market.
“We expect a seasonal rise of inventory this spring, but it may be insufficient to avoid more frequent incidences of multiple bidding and faster-than-normal price growth, “ Yun explained.