The National Association of Realtors reports that existing-home sales rose in January, marking two consecutive months of growth, increasing 0.6% from December 2020 to a seasonally adjusted annual rate of 6.69 million in January 2021. Total sales climbed year-over-year, up 23.7% from one year ago.
"Home sales continue to ascend in the first month of the year, as buyers quickly snatched up virtually every new listing coming on the market," said Lawrence Yun, NAR's Chief Economist. "Sales easily could have been even 20% higher if there had been more inventory and more choices."
The median existing-home price for all housing types in January was $303,900, up 14.1% from January 2020 where prices averaged $266,300, with prices increasing in every region. January's national price jump marks 107 straight months of year-over-year gains.
"Home sales are continuing to play a part in propping up the economy," Yun said. "With additional stimulus likely to pass and several vaccines now available, the housing outlook looks solid for this year."
Yun predicts existing-home sales will reach at least 6.5 million in 2021, even as he says mortgage rates are likely to inch higher due to the rising budget deficit and higher inflation.
Total housing inventory at the end of January amounted to 1.04 million units, down 1.9% from December and down 25.7% from one year ago (1.40 million). Properties typically remained on the market for 21 days in January, seasonally even with December, and down from 43 days in January 2020. Seventy-one percent of the homes sold in January 2021 were on the market for less than a month.
First-time buyers accounted for 33% of total sales in January, up from 31% in December 2020, and from 32% in January 2020. Individual investors or second-home buyers purchased 15% of homes in January, up from 14% in December 2020, but down from 17% in January 2020. All-cash sales accounted for 19% of transactions in January, unchanged from December but down from 21% in January 2020.
Distressed sales represented less than 1% of sales in January, equal to December's percentage, but down from 2% in January 2020.