Existing home sales, as reported by the National Association of Realtors (NAR), rose to the highest pace in six years in May. The report was also notable due to an increase in purchases by first-time buyers, which rose to the highest share experienced since September 2012.
The May pace of existing home sales (5.35 million on seasonally adjusted annual basis) was 5.1% higher than the prior month and 9.2% higher than the rate set during May of 2014. Sales of single-family homes were up 5.6% for the month, reaching a 4.73 million annual rate.
The first-time buyer share increased to 32% in May, up from 30% in April. NAR reported that first-time buyer share reached its highest level since September 2012. This increase is consistent with prior analysis of Fannie Mae data illustrating that the share of mortgage originations to first-time home buyers is expected to rise in 2015.
Regionally, existing home sales increased strongly in the Northeast (11.3% for May) and are up 11.3% year-over-year. Midwest sales increased 4.1% for the month and now stand 12.4% higher than May 2014. Sales in the West rose 4.3% in May and are up 9% from a year ago. Finally, sales in the South increased 4.3% compared to April and are 6.9% higher than May 2014.
Total housing inventory, as estimated by NAR, increased 3.2% t0 2.29 million existing housing units. This marks a 5.1 months-supply at the May sales pace.
The median existing home price in May was $228,700. NAR noted that May represented the 39th consecutive month of year-over-year price gains for existing homes.