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U.S existing-home sales unexpectedly rose to a three month high in January. Americans are taking advantage of the historically low mortgage rates that have continued to power the industry during the pandemic. According to the National Association of Realtors, contract closings increased 0.6% from the prior month.
The pandemic has increased the demand of single-family homes. This, combined with the low borrowing costs, has propelled demand. In fact, sales of existing homes last year were the strongest since 2006.
While mortgage rates have inspired a lot of home purchases in the last couple of months, prices are rising. There was a 14.1% median selling price increase from a year earlier to January. In January, properties remained on the market for 21 days. Inventory is very low. There was a record low number of homes for sale last month, down 25.7% from the previous year.
In addition, recent data suggests that the housing market will continue to be hot for months to come. Permits to build single-family homes rose at the fastest pace since 2006. Existing home sales of single family homes rose 0.2%, while sales of condos rose 4.1%.
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