2016 Existing-Home Sales Mark Highest Rate in a Decade

Washington, DC, January 24, 2017—Total existing-home sales finished 2016 at 5.45 million sales and surpassed 2015 (5.25 million) as the highest since 2006 (6.48 million), according to the National Association of Realtors. This marks the best year in a decade.

In December, existing sales decreased 2.8% to a seasonally adjusted annual rate of 5.49 million in December from an upwardly revised 5.65 million in November. With last month's slide, sales are only 0.7% higher than a year ago.

Lawrence Yun, NAR chief economist, says the housing market's best year since the Great Recession ended on a healthy but somewhat softer note. "Solid job creation throughout 2016 and exceptionally low mortgage rates translated into a good year for the housing market," he said. "However, higher mortgage rates and home prices combined with record low inventory levels stunted sales in much of the country in December."

Added Yun, "While a lack of listings and fast rising home prices was a headwind all year, the surge in rates since early November ultimately caught some prospective buyers off guard and dimmed their appetite or ability to buy a home as 2016 came to an end."

The median existing-home price 2 for all housing types in December was $232,200, up 4.0% from December 2015 ($223,200). December's price increase marks the 58th consecutive month of year-over-year gains. 

Total housing inventory at the end of December dropped 10.8% to 1.65 million existing homes available for sale, which is the lowest level since NAR began tracking the supply of all housing types in 1999. Inventory is 6.3% lower than a year ago (1.76 million), has fallen year-over-year for 19 straight months and is at a 3.6-month supply at the current sales pace (3.9 months in December 2015).