Sales of existing homes continued to surge in January.
The pace of sales increased 0.7 percent from December to an annual rate of 6.69 million, according to the National Association of Realtors’ monthly report. January’s rate was up nearly 24 percent year-over-year.
NAR’s chief economist, Lawrence Yun, said the pace would have been even higher if not for the lack of housing available for purchase.
“Sales easily could have been even 20 percent higher if there had been more inventory and more choices,” he said in a statement.
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Housing inventory fell to yet another historic low in January with a mere 1.04 million units on the market, down 1.9 percent from December and down nearly 26 percent from a year earlier.
At last month’s rate, the unsold inventory would be bought in 1.9 months. Seventy percent of homes sold last month were on the market for less than a month.
Joel Kan, head of industry forecasting at the Mortgage Bankers Association, said the limited supply was pushing up prices. The median price across all housing types was $303,900 in January, up 14 percent from $266,300 in January 2020.
The average purchase loan size recorded in MBA’s weekly survey of the mortgage market has been reaching historic highs for weeks. Last week, the average loan size was $412,200.
Kan noted that the rate of new building permits, an indicator of new residential construction, made significant gains last month, despite the rate of housing starts declining.
“[That] hopefully bodes well for more choices for buyers and slower price growth in the spring,” he said in a statement.