Total existing home sales rose to a seasonally adjusted annual rate of 4.89 million in May, according to the National Association of Realtors. That’s up from an upwardly revised rate of 4.66 million in April, but still 5% below May 2013’s rate of 5.15 million.
“Home buyers are benefiting from slower price growth due to the much-needed, rising inventory levels seen since the beginning of the year,” said Lawrence Yun, NAR chief economist. “Moreover, sales were helped by the improving job market and the temporary but slight decline in mortgage rates.”
Total housing inventory rose 2.2% in May to 2.28 million existing homes. That represents a 5.6-month supply at the current rate, down from 5.7 months in April. Unsold inventory is 6% higher than May of 2013, when 2.5 million existing homes were available.
The median existing home price last month was $213,000, 5.1% higher than a year ago.
“Rising inventory bodes well for slower price growth and greater affordability, but the amount of homes for sale is still modestly below a balanced market,” Yun said. “Therefore, new home construction is still needed to keep prices and housing supply healthy in the long run.”
The share of first-time home buyers, meanwhile, remained on the low side. First-time buyers accounted for 27% of all buyers in May, down from 29% in April.
Existing home sales surged in May while inventory gains helped take the edge off rising prices, according to data released Monday.