Existing-Home Sales Rose 1.1% in 2017

Washington, DC, January 24, 2018-Existing-home sales subsided in most of the country in December, but 2017, as a whole, edged up 1.1% and ended up being the best year for sales in 11 years, according to the National Association of Realtors.

Total existing-home sales increased 1.1% in 2017 to a 5.51 million sales pace and surpassed 2016 (5.45 million) as the highest since 2006 (6.48 million).

In December, existing-home sales slipped 3.6% to a seasonally adjusted annual rate of 5.57 million from a downwardly revised 5.78 million in November. After last month’s decline, sales are still 1.1% above a year ago.

Lawrence Yun, NAR chief economist, says the housing market performed remarkably well for the U.S. economy in 2017, with substantial wealth gains for homeowners and historically low distressed property sales. “Existing sales concluded the year on a softer note, but they were guided higher these last 12 months by a multi-year streak of exceptional job growth, which ignited buyer demand,” said Yun. “At the same time, market conditions were far from perfect. New listings struggled to keep up with what was sold very quickly, and buying became less affordable in a large swath of the country. These two factors ultimately muted what should have been a stronger sales pace.”

Added Yun, “Closings scaled back in most areas last month for this same reason. Affordability pressures persisted, and the pool of interested buyers at the end of the year significantly outweighed what was available for sale.”

The median existing-home price for all housing types in December was $246,800, up 5.8% from December 2016 ($233,300). December’s price increase marks the 70th straight month of year-over-year gains.

Total housing inventory at the end of December dropped 11.4% to 1.48 million existing homes available for sale, and is now 10.3% lower than a year ago (1.65 million) and has fallen year-over-year for 31 consecutive months. Unsold inventory is at a 3.2-month supply at the current sales pace, which is down from 3.6 months a year ago and is the lowest level since NAR began tracking in 1999.