Existing-home sales declined in February, following two prior months of gains, according to a new report from the National Association of Realtors (NAR).
Month-over-month, only one major region saw an increase in February, but all four U.S. regions recorded year-over-year gain.
Total existing-home sales decreased 6.6 percent from January to a seasonally adjusted annual rate of 6.22 million in February. Sales in total climbed year-over-year, up 9.1 percent from a year ago (5.70 million in February 2020).
“Despite the drop in home sales for February – which I would attribute to historically-low inventory – the market is still outperforming pre-pandemic levels,” NAR Chief Economist Lawrence Yun said in a news release.
Yun warned of a possible slowdown in growth in the coming months as higher prices and rising mortgage rates will cut into home affordability.
“I still expect this year’s sales to be ahead of last year’s, and with more COVID-19 vaccinations being distributed and available to larger shares of the population, the nation is on the cusp of returning to a sense of normalcy,” Yun said. “Many Americans have been saving money and there’s a strong possibility that once the country fully reopens, those reserves will be unleashed on the economy.”
The median existing-home price for all housing types in February was $313,000, up 15.8 percent from February 2020 ($270,400), as prices rose in every region. February’s national price jump marks 108 straight months of year-over-year gains.
“Home affordability is weakening,” Yun said. “Various stimulus packages are expected, and they will indeed help, but an increase in inventory is the best way to address surging home costs.”
Single-family home sales decreased to a seasonally adjusted annual rate of 5.52 million in February, down 6.6 percent from 5.91 million in January, and up 8 percent from one year ago. The median existing single-family home price was $317,100 in February, up 16.2 percent from February 2020.
Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 700,000 units in February, down 6.7 percent from January and up 18.6 percent from one year ago. The median existing condo price was $280,500 in February, an increase of 12.3 percent from a year ago.
Compared to one year ago, median home prices increased in each of the four major regions.
February 2021 saw existing-home sales in the Northeast fall 11.5 percent, recording an annual rate of 770,000, a 13.2 percent increase from a year ago. The median price in the Northeast was $356,000, up 20.5 percent from February 2020.
Existing-home sales in the Midwest dropped 14.4 percent to an annual rate of 1,310,000 in February, a 2.3 percent rise from a year ago. The median price in the Midwest was $231,800, a 14.2 percent increase from February 2020.
Existing-home sales in the South decreased 6.1 percent, posting an annual rate of 2,770,000 in February, up 9.9 percent from the same time one year ago. The median price in the South was $271,200, a 13.6 percent increase from a year ago.
Existing-home sales in the West rose 4.6 percent from the month prior, recording an annual rate of 1,370,000 in February, a 12.3 percent jump from a year ago. The median price in the West was $493,300, up 20.6 percent from February 2020.