Total existing home sales—including single-family homes, townhomes, condominiums, and co-ops—rose by 0.7% month over month and 22.2% year over year in December, up to a seasonally adjusted annual rate of 6.76 million, according to the National Association of Realtors. At the same time, year-end existing home sales volume totaled 5.64 million in 2020—up 5.6% from 2019, and the highest number recorded since 2006.
“Home sales rose in December, and, for 2020 as a whole, we saw sales perform at their highest levels since 2006, despite the pandemic,” says Lawrence Yun, NAR’s chief economist. “What’s even better is that this momentum is likely to carry into the new year, with more buyers expected to enter the market. … Although mortgage rates are projected to increase, they will continue to hover near record lows at around 3%. Moreover, expect economic conditions to improve with additional stimulus forthcoming and vaccine distribution already underway.”
The median existing home price for all housing prices was $309,800 in December, up 12.9% from $274,500 in December 2019. This marks 106 straight months of year-over-year price increases for existing homes. Total housing inventory totaled 1.07 million units, down 16.4% from November and down 23% from December 2019. Unsold inventory sits at an all-time low 1.9-month supply at the current sales pace.
“To their credit, home builders and construction companies have increased efforts to build, with housing starts hitting an annual rate of near 1.7 million in December, with more focus on single-family homes,” Yun says. “However, it will take vigorous new-home construction in 2021 and in 2022 to adequately furnish the market to properly meet the demand.”
Properties typically remained on the market for 21 days in December, down from 41 days in December 2019. Seventy percent of homes sold in December were on the market for less than a month. First-time buyers accounted for 31% of existing home sales, while individual investors or second home buyers accounted for 14% of transactions. Distressed sales represented less than 1%.
Alone, single-family home sales rose to a seasonally adjusted annual rate of 6.03 million in December, up 0.7% from 5.99 million in November and 22.8% from one year ago. Please visit website for more details.
At the regional level, existing home sales rose 4.5% month over month to an annual rate of 930,000 in the Northeast, or 27.4% from one year ago. Existing home sales were unchanged month over month in the Midwest at an annual rate of 1,590,000, up 26.2% from one year ago. Sales rose 1.1% month over month in the South to an annual rate of 2,860,000, up 20.7% from one year ago, and existing sales in the West fell 1.4% to an annual rate of 1,380,000, up 17.9% from one year ago.