Sales on existing homes reached an 11-year high in November, jumping 5.6 percent over the month. According to the National Association of Realtors' Existing Home Sales data, about 5.81 million existing homes were sold in that period.
November’s existing home sales marked a rise of more than 300,000 for the month, reaching their highest point since December 2006—when sales hit 6.42 million. They’re also up nearly 4 percent since 2016.
According to Lawrence Yun, NAR Chief Economist, the uptick was likely due to improving economic factors.
“Faster economic growth in recent quarters, the booming stock market, and continuous job gains are fueling substantial demand for buying a home as 2017 comes to an end,” Yun said. “As evidenced by a subdued level of first-time buyers and increased share of cash buyers, move-up buyers with considerable down payments, and those with cash made up a bulk of the sales activity last month. The odds of closing on a home are much better at the upper end of the market, where inventory conditions continue to be markedly better.”
The median price on existing homes was also up for November, hitting $248,000—a jump of 5.8 percent since last year and the 69th consecutive month of increases. According to Yun, these rising prices, coupled with increasing mortgage rates, could pose an affordability problem for many buyers come 2018.
“The anticipated rise in mortgage rates next year could further cut into affordability if these staggeringly low supply levels persist,” Yun said. “Price appreciation is too fast in a lot of markets right now. The increase in homebuilder optimism must translate to significantly more new construction in 2018 to help ease these acute inventory shortages.”
NAR’s data also showed first-time buyers and distressed sales down for the month. Distressed sales accounted for just 4 percent of all sales—a dip from the 6 percent share seen just one year prior. It’s the fourth consecutive month distressed sales have dropped.
See all of NAR’s Existing Home Sales data from November at NAR.Realtor/Existing-Home-Sales.