Home sales climb 2% in October
NEW YORK (CNNMoney) — The pace of sales for previously owned homes rose in October, despite the devastation of Superstorm Sandy, in the latest sign of improvement for the long-battered housing market.
Existing home sales rose to an annual rate of 4.79 million, seasonally adjusted, the National Association of Realtors reported on Monday. That’s up 2.1% from September, when the revised annual rate of existing home sales was 4.69 million. And it’s an increase of 11% year-over-year, when the annual rate was 4.32 million.
That was also stronger than the forecast from analysts at Briefing.com, which called for an annual rate of 4.7 million existing home sales in October.
The National Association of Realtors said sales had gone up nationwide, “even with some regional impact from Hurricane Sandy,” the deadly storm that caused massive disruptions in the Northeast at the end of October.
Lawrence Yun, the association’s chief economist, said the market is being driven by “growing demand with limited inventory” but it could run into strong headwinds from Sandy going forward.
“We expect an impact on Northeastern home sales in the coming months … in storm-impacted regions,” he said.
Home buyers are being lured by low mortgage rates. Last week, mortgage rates dropped again, pushing 15-year and 30-year fixed-rated loans to record lows.
Also, the National Association of Realtors said last week that the median down payment has sunk to 9% for home buyers this year, its lowest level since 2009.
Meanwhile, home prices have been inching up. The average home price in 20 major cities edged up 0.9% in August, according to the most recent figures from the S&P/Case-Shiller home price index.
Keith Gumbinger, vice president of mortgage information website HSH, said the rising sales are “a signal to fence-sitters that the market is beginning to shift, and that waiting may not yield them any lower costs.”