The Northeast led gains across all four major regions
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There was an improvement in existing home sales in May, the first gain in two months.
The National Association of Realtors reported that completed sales hit a seasonally adjusted annual rate of 5.34 million, up 2.5% from April but still 11% below the 5.40 million rate of May 2018.
The Northeast saw the largest gain (4.7%) to an annual rate of 670,000, about equal to a year ago. The median price in the Northeast was $304,100, up 6.6% from May 2018.
The Midwest saw a jump of 3.4% to an annual rate of 1.22 million, 3.9% below May 2018 levels. The median price in the Midwest was $220,500, an increase of 5.6% from a year ago.
There was a 1.8% rise for the South to an annual rate of 2.32 million in May, up 1.3% from a year ago. The median price in the South was $241,400, up 3.6% from a year ago.
Existing-home sales in the West grew 1.8% to an annual rate of 1.13 million in May, 3.4% below a year ago. The median price in the West was $409,100, up 4.1% from May 2018.
Purchase power increased
"The purchasing power to buy a home has been bolstered by falling mortgage rates, and buyers are responding,” commented NAR chief economist Lawrence Yun.
Despite lower rates, affordability was still under pressure from rising prices with the national median up 4.8% year-over-year to $256,100.
There was some relief from the tight inventory – up 2.7% from a year ago to 1.92 million - but it remained low by historic standards with just 4.3 months of supply at the current sales pace.
"Solid demand along with inadequate inventory of affordable homes have pushed the median home price to a new record high," added Yun.
First-time buyers hold steady
First-time buyers were responsible for 32% of sales in May, unchanged from the 32% the month prior and up from the 31% recorded in May 2018.
All-cash sales accounted for 19% of transactions in May, down from April and a year ago (20% and 21%, respectively). Individual investors, who account for many cash sales, purchased 13% of homes in May, down from 16% in April and from 14% a year ago.
