Existing home sales in the U.S. increased by much more than anticipated in the month of February, according to a report released by the National Association of Realtors on Wednesday.
NAR said existing home sales jumped by 3.0 percent to an annual rate of 5.54 million in February from a rate of 5.38 million in January. Economists had expected existing home sales to rise by 0.5 percent.
“The very healthy U.S. economy and labor market are creating a sizeable interest in buying a home in early 2018,” said NAR chief economist Lawrence Yun.
“However, even as seasonal inventory gains helped boost sales last month, home prices – especially in the West – shot up considerably,” he added. “Affordability continues to be a pressing issue because new and existing housing supply is still severely subpar.”
The report said the median existing home price for all housing types in February was $241,700, up 5.9 percent from the same month a year ago.
Total housing inventory at the end of February rose 4.6 percent to 1.59 million existing homes available for sale but is still 8.1 percent lower than a year ago, NAR said.
On Friday, the Commerce Department is scheduled to release its report on new home sales in the month of February. New home sales are expected to surge up by 4.4 percent.