M
arket Momentum Shifts as Home Sales Rise in February
The National Association of REALTORS reports a 4.2% increase in existing-home sales for February, with two major U.S. regions experiencing growth and one region remaining stable while another declined. The seasonally adjusted annual rate reached 4.26 million transactions.
According to NAR Chief Economist Lawrence Yun, "Home buyers are slowly entering the market," driven by increased inventory and choices that are releasing pent-up housing demand. Mortgage rates have remained relatively steady, with the 30-year fixed-rate averaging 6.65% as of March 13.
Total housing inventory rose 5.1% from January to 1.24 million units, a 17% increase from one year ago. Unsold inventory sits at a 3.5-month supply, identical to January and up from 3.0 months in February 2024.
The median existing-home price for all housing types reached $398,400 in February, a 3.8% increase from the previous year. All four U.S. regions reported price gains, with each percentage point gain translating into an approximately $350 billion increase in housing equity for American property owners.
First-time buyers accounted for 31% of sales in February, up from 28% in January and 26% in February 2024. Cash sales comprised 32% of transactions, while distressed sales represented 3% of sales.
Regional Breakdown
* The Northeast saw a 2.0% decrease in existing-home sales from January to an annual rate of 500,000, up 4.2% from February 2024.
* The Midwest reported unchanged sales at an annual rate of 1 million, up 1.0% from the prior year.
* The South experienced a 4.4% increase in existing-home sales to an annual rate of 1.91 million, down 4.0% from one year before.
* The West saw a 13.3% jump in existing-home sales to an annual rate of 850,000, identical to the previous year.
The ongoing housing shortage and historically low mortgage default rates imply a solid foundation for home values. As the current stock market undergoes a correction, the nearly $1.3 trillion gain in home value appreciation provides a significant boost to American property owners.
