The Real Deal New York

Home sales reach highest level since beginning of recession

Rising mortgage rates, prices might put a damper on things
December 21, 2016 02:45PM

Home sales in November jumped to the highest levels seen since the beginning of the recession, but the flurry of activity could be tempered by rising mortgage rates and sale prices.

Sales of previously-owned homes in the U.S. rose 15.4 percent year-over-year last month to an annual rate of 5.6 million, the highest sales rate seen since 2007, according to a study by the National Association of Realtors (NAR).

At the same time, borrowing rates have soared since the Nov. 8 election. For 30-year fixed-rate mortgages, the average rate was 3.77 percent in November — up from 3.47 the previous month, the Wall Street Journal reported. The average rate has continued to climb in December, reaching 4.16 percent last week.

“We do expect some tapering off of home sales in 2017,” Lawrence Yun, the NAR’s chief economist, told the Journal.

Sales prices are also increasing as supply tightens. In November, the median sales price was $234,900, which was a 6.8 percent jump from the same time last year. [WSJ] — Kathryn Brenzel