As they do this time of year, prices on existing homes began falling in August—which may have led to a bump in sales.
Purchases of existing homes had fallen sharply in July but rebounded in August, according to the latest report from the National Association of Realtors®. Sales of the previously lived-in residences rose 5.5% from a month prior and 7.3% from a year earlier, hitting 541,000 deals.
These numbers were not seasonally adjusted. That means they weren’t smoothed out over 12 months to account for the ups and downs of the housing market.
The median price of the properties dropped slightly from the previous month, by 1.3%, to reach $240,200 across the country, according to the report. Those price tags were still 5.1% higher than the same time a year ago.
They were, however, significantly lower than the cost of a newly built home. Those residences sold for a median $294,60 in July, according to the most recent U.S. Commerce Department numbers.
The cost of purchasing an abode typically starts declining in August, says realtor.com®‘s chief economist, Jonathan Smoke.
“The majority of buyers focus their attention on trying to find a home, get under contract, and close before school starts,” he says. “For most of the country, that is in August.”
The increase in sales may also have something to do with the two extra business days that fell in August this year, Smoke says.
“The housing market is very strong,” he says. “There is no question that the [number] of homes for sale is low and limiting the potential for new sales.”
Most of the sales were in the South, where homes are less expensive than the East and West coasts. The region has seen an influx of companies, bringing jobs and new residents along with them, drawn by the lower costs of living and doing business.
In August, about 217,00 existing homes were sold in the South, a 7.4% increase from a year ago. Prices were up 6.7% annually, with the median $209,700.
Sales were also high in the Midwest, where prices were the lowest in the country. About 132,000 homes went under contract in August, a 7.3% annual bump. Prices were also up 5.5% year over year, at $190,700.
In the West, sales rose 7.5% annually, with 115,000 abodes being bought in August. That’s despite the region being the nation’s most expensive. Median prices also rose 9.2%, to $347,400.
The fewest homes were sold in the Northeast, where there isn’t as much land available for new construction as in other parts of the country, further restricting supply. Sales rose 6.9% over the previous year, with buyers closing on about 77,000 homes. Prices also rose 0.8% in the region, to $274,100.