Rise in Existing Home Sales in May 2014

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There is finally good news for the US housing market. The sales of existing homes picked up in May 2014. Inventory improved on a monthly basis as well. The market is still not performing as strongly as it did in spring 2013, but the improvement is considerable.

In May 2014, the existing home sales rose by 4.9% from the previous month, according to the data presented by the National Association of Realtors. This was the largest gain since August 2011. It makes many economists quite optimistic about the housing market.

Despite the improvement, the market could not reach its performance levels from the spring of last year. In May, the existing home sales were 4.89 million while in April they were 4.66 million. For comparison, in May 2013, they were 5.15 million. This means that currently, the sales are 5% lower than last year.

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The situation with the sales of existing single-family homes is similar. They rose by 5.7% from April to May 2014 from 4.07 to 4.3 million units. At the same time, they remain 5.7% lower than last May when 4.56 million units were sold.

Analysts explain the rise in existing home sales with two predominant factors. The first one is the decline in mortgage rates from the summer of 2013 when they rose considerably. Now the rates are close to the historic low and are expected to remain in the current range in the coming months. The other factor is the growing inventory. It increases slowly, but steadily and this makes home prices grow at a slower rate which is favorable to buyers.

The total housing inventory rose by 2.2% in May to reach 2.28 million units. The unsold inventory is 6% higher compared to this time of last year. The median home price is 5.1% higher than it was in May 2013.

The positive trend in the sales of existing homes will remain if the prices in the housing market continue to climb at a slow pace.

Christian

Christian

Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info
Christian

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