|
Existing home sales leap
|
 |
July 26, 1999: 10:41 a.m. ET
June sales soar 10.6% to record level as buyers seek to beat rate hikes
|
NEW YORK (CNNfn) - Sales of existing homes rose in June to the highest level ever recorded as buyers were jarred into action by rising interest rates, according to a National Association of Realtors report released Monday.
The seasonally adjusted annual sales rate climbed 10.6 percent to 5.530 million units from May's revised 5.00 million. The June figure was well above the 5.07 million annual rate expected by economists polled by Reuters and the 5.08-million unit rate recorded in June 1998. It also topped the previous record rate of 5.42 million units set in March.
Buy now, save later?
NAR President Sharon A. Milllet attributed the surge to interest-rate-inspired "fence-jumping."
"When buyers saw interest rates moving up this spring, they jumped off the fence and into the market to take advantage of excellent affordability condition before mortgage rates moved higher," she explained. "Of course, high consumer confidence with an excellent job market in a strong economy doesn't hurt," she added.
According to Freddie Mac, the national average commitment rate for a 30-year conventional, fixed-rate mortgage was 7.55 percent in June, above both the 7.15 percent rate registered for May and the 7.00 percent average recorded in June 1998.
Millett said that home resales are on track to set a new record this year.
"The momentum of existing-home sales has been stronger than expected this year, with the sales pace on track to the five-million mark for 1999," she said. Last year, the total of existing home sales reached 4.97 million, the current record.
On Friday, the Commerce Department will report on new home sales for June. Economists surveyed by Reuters expect the annual rate to increase slightly to 892,000 from 888,000 in the previous month.
On the home-building front, however, the rate of new home construction dropped dramatically in June, falling 5.6 percent to an annualized rate of 1.571 million units, the Commerce Department said last week.
|
|
|
|
|
 |
|
