What many analysts see as the healthy recovering in the housing sector of the economy continued in February.
The National Association of Realtors (NAR) reports both sales and prices of previously-owned homes rose last month. Sales have now been above year-ago levels for 20 consecutive months, while prices show 12 straight months of year-over-year price increases.
Existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 0.8% to a seasonally adjusted annual rate of 4.98 million in February, and are 10.2% above the 4.52 million-unit level seen a year earlier. Sales in February were at the highest level since the tax credit period of November 2009.
"Job growth in the improving economy and pent-up demand are causing both home sales and rental leasing to rise,” said NAR Chief Economist Lawrence Yun. “Though home prices are rising much faster than rents, historically low mortgage rates are still making home purchases affordable."
Yun says the only headwinds are limited housing inventory, which varies greatly around the country, and credit conditions that he believes remain too restrictive. Total housing inventory at the end of February rose 9.6% -- to 1.94 million existing homes available for sale. That represents a 4.7-month supply at the current sales pace, compared with 4.3 months in January, which was the lowest supply since May 2005. Listed inventory is 19.2 percent below a year ago when there was a 6.4-month supply.
The national median existing-home price for all housing types was $173,600 in February, up 11.6% from a year ago. The last time there were 12 consecutive months of year-over-year price increases was from June 2005 to May 2006. The February gain is the strongest since November 2005 when it was 12.9 percent above a year earlier.
"A strong rise in home values is contributing to housing wealth recovery, which has risen by $1.4 trillion in the past year and looks to top that increase this year," Yun said. "The extra consumer spending arising from growth in housing wealth is expected to be $70 billion to $110 billion this year."
Separately, the Federal Housing Finance Agency (FHFA) reports home prices rose 0.6% from December to January, while the previously reported 0.6% increase in December was revised downward to a 0.5% increase. For the 12 months ending in January, prices were up 6.5%.
The agency's House Price Index is 14.4% below its April 2007 peak and is roughly the same
as the September 2004 index level. National home prices have not declined on a monthly basis
since January 2012.
In other economic news, the Labor Department says first-time claims for unemployment benefits rose by 2,000 last week -- to a seasonally adjusted total of 336,000.
The four week moving average, which is less volatile and considered a more accurate gauge of the labor market, was 339,750 -- a decrease of 7,500 from the previous week's revised average of 347,250.