Steel Markets

Existing-Home Sales Gain Ground in November

Written by David Schollaert

Existing-home sales expanded for the third straight month in November, reported the National Association of Realtors. Of the four major U.S. regions, only the Northeast didn’t register a month-on-month gain, holding flat versus October. The Midwest ticked up 0.7%, the South grew by 2.9%, while the West rose by 2.3% in November when compared to the prior month. Year to date, however, only the South region posted an increase in sales, up 1.1%.

November sales grew 1.9% from October to a seasonally adjusted annual rate of 6.46 million. Total registered sales of 6.59 million were down, though, by 2.0% from a year ago.

“Determined buyers were able to land housing before mortgage rates rise further in the coming months,” said Lawrence Yun, NAR’s chief economist. “Locking in a constant and firm mortgage payment motivated many consumers who grew weary of escalating rents over the last year.

“Mortgage rates are projected to jump in 2022, however, I don’t expect the imminent increase to be overly dramatic,” added Yun.

The median existing-home price rose 13.9% from November 2020 to $353,900. All regions posted increased pricing in November, marking the 117th straight month of year-over-year gains.

“Supply-chain disruptions for building new homes and labor shortages have hindered bringing more inventory to the market,” said Yun. “Therefore, housing prices continue to march higher due to the near record-low supply levels.”

Total housing inventory at the end of November fell 9.8% from October to 1.11 million units, down 13.3% from one year ago. Inventory is at a 2.1-month supply at the current sales pace. Properties averaged 18 days on the market in November, unchanged from Octobers totals, but down 21 days from the same period a year ago.

NAR reports that 83% of homes sold in November were on the market for less than a month. First-time buyers accounted for 26% of sales last month, down from 29% in October and down 32% year on year.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 3.07% in November, equal to October’s rate. The average commitment rate across all of 2020 was 3.11%.

David Schollaert

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