Sales of pre-owned homes jumped more than expected in March as real estate prices continued to rise, according to a report out Monday from the National Association of Realtors.
Total existing-home sales rose 1% for the month to an annual rate of 6.89 million, from an upwardly revised pace of 6.82 million in February. That marks the strongest pace set since November 2004, when sales hit an annual pace of 6.98 million.
Economists were expecting a reading of only 6.8 million for March after the government disappointed the markets last week with a dismal report on housing starts. The Census Bureau said housing starts dropped to an annual rate of 1.837 million in March, down from 2.229 million in February.
That report inspired some of last week's selling in the stock market. Monday's news from NAR buoyed spirits, with the
recently trading up 0.9%.
"With mortgage interest rates remaining historically low, gains in the labor market and economic growth appear to have lifted the confidence of home buyers," said David Lereah, NAR's chief economist. "There's no question there is a strong demand for housing from a growing population."
The national median existing-home price for all housing types was $195,000 in March, up 11.4% from March 2004 when the median price was $175,000. Total housing inventory levels fell 0.2% at the end of March to 2.33 million existing homes available for sale, which represents a 4.0-month supply at the current sales pace.