By Joe Musso
Existing-home sales rose 2.4 percent in September, reaching the highest level of 2014 and surpassing economists’ average forecast.
The median price of previously owned homes in September rose 5.6 percent to $209,700 from September 2013.
Total sales, including single-family homes, townhomes, condominiums and co-ops rose to a seasonally adjusted annual rate of 5.17 million units in September, from a 5.05 million-unit annual rate in August, according to the National Association of Realtors.
Economists had expected an increase of 1.0 percent to 5.1 million units on an annual basis.
“Low interest rates and price gains holding steady led to September’s healthy increase,” said Lawrence Yun, chief economist at the association.
Total housing inventory fell 1.3 percent to 2.3 million homes available for sale. Still, unsold inventory is struggling to reach last year’s levels, when the existing for sale home figure came in at 2.17 million.
“Traditional buyers are entering a less competitive market with fewer investors searching for available homes, but may also face a slight decline in choices due to the fact that inventory generally falls heading into the winter,” Yun said.
Individual investors accounted for 14 percent of purchased homes in September, up from 12 percent last month, but below the year-ago level of 19 percent.
The percentage of first-time buyers held steady at 29 percent for the third consecutive month, while historic averages are closer to 40 percent, Diane Swonk, chief economist at Mesirow Financial, wrote in a blog post Tuesday.
“The housing market showed some signs of healing in September, especially in light of the drop of support from low down payment loans,” Swonk wrote.
Regionally, Midwest home sales were the only fall in September, they slipped 5.6 percent to an annual level of 1.17 million units. The Northeast and South rose 1.5 percent and 5.0 percent respectively, while the West jumped 7.1 percent.