Existing home sales reach highest since February 2007

WASHINGTON – Americans bought homes in November in the fastest pace in nearly a decade, despite a deepening shortage of houses for sale.

The National Association of Realtors said Wednesday that sales of existing homes rose 0.7 percent last month to a seasonally adjusted annual rate of 5.61 million. That was up from a downwardly revised 5.57 million in October and the highest since sales hit a 5.79 million pace in February 2007. Sales were up 15 percent from a year earlier.

“Housing is chugging ahead,” said Lawrence Yun, the Realtors’ chief economist.

Sales rose 8 percent in the Northeast and 1.4 percent in the South, but fell in the West and Midwest.

Fewer than 1.9 million homes were on the market, down 9 percent from a year earlier. The tight supply pushed the median price to $234,900 last month, up 6.8 percent from a year ago.

The Commerce Department reported Friday that housing starts fell 18.7 percent last month to a seasonally adjusted 1.09 million.

“We have a housing shortage,” Yun said. “We are not building enough housing.”

At the same time, the rate on the benchmark 30-year fixed rate mortgage last week rose to a 52-week high of 4.16 percent. U.S. interest rates have climbed since the Nov. 8 election of Donald Trump. Investors have bid rates higher because they expect Trump’s program of tax cuts and higher spending on defense and infrastructure will boost economic growth and inflation.

Still, a healthy job market has given more Americans the confidence to shop for homes. Unemployment is at a nine-year low 4.6 percent.