Categories Finance, LATEST, U.S. Markets News

Existing home sales rise to 5-month high in July, backed by low interest rates

Existing home sales rebounded in July after declining in the previous month as buyers sought to take advantage of the low interest rates. The housing market seems to be gathering strength from the positive economic momentum and record low unemployment rate.

Sales of previously owned houses increased a seasonally adjusted 2.5% to 5.42 million units in July, the highest in the last five months. The growth rate also exceeded economists’ forecast. In June, sales were slightly down. On a year-over-year basis, total sales were up 0.6% in July.

Will Fed cut rates in July
Photo Courtesy: Federal Reserve

Data published by the National Association of Realtors, the largest trade association in America, Wednesday showed that Midwest, South, and West witnessed an increase in activity, while Northeast registered a decline.

“Falling mortgage rates are improving housing affordability and nudging buyers into the market. The shortage of lower-priced homes has markedly pushed up home prices,” said Lawrence Yun, chief economist at the National Association of Realtors, adding that the supply of affordable homes was inadequate during the month, which prompted sellers to convert some new apartments into condominiums.

Also see: Amex Q2 results beat on strong cardmember spending

There was a 4.3% rise in the average price of existing homes to $280,800, continuing the uptrend that began nearly seven-and-half years ago. At the end of July, there were 1.89 million residential properties available for sale, down 2% month-on-month.  First-time buyers accounted for about 32% of the total sales, which is slightly below the preceding month’s level.

Statistics indicate that in addition to favorable interest rates and strong labor market, improved confidence among home-buyers, primarily about the health of the economy, contributed to the growth.

Related: Will the June inflation prompt the Fed to cut rates?

There has been an uptick in activity in the real estate sector ever since the Federal Reserve adopted a dovish stance with regard to its monetary policy. After the central bank slashed the key interest rate by 25 basis points to 2.25% last month – for the first time since the economic crisis – there has been speculation that it might go for more cuts at the upcoming policy meetings.

Browse through our earnings calendar and get all scheduled earnings announcements, analyst/investor conference and much more!

Most Popular

PayPal Holdings (PYPL) Q1 2021 revenue up 31%; earnings beat

PayPal Holdings Inc. (NASDAQ: PYPL) reported stronger-than-expected earnings and revenues for the first quarter of 2021. Shares of the payment service provider gained during Wednesday’s extended trading session soon after

Infographic: How Twilio (TWLO) performed in Q1 2021

Twilio (NYSE: TWLO) reported first quarter 2021 earnings results today. Revenue increased 62% year-over-year to $590 million. GAAP net loss widened to $206 million, or $1.24 per share, compared to

Uber Technologies reports Q1 loss of 6 cents per share: Infographic

Uber Technologies (NYSE: UBER) reported first-quarter 2021 financial results after the regular market hours on Wednesday. The ride-hailing company reported Q1 revenue excluding the UK accrual of $3.5 billion, up

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top