Record-low mortgage rates spur a 20 percent increase, but sales are still down for the year and millions of job losses threaten to slow the recovery.
U. S. sales of previously owned homes rose in June for the first time in four months as the economy reopened more broadly from coronavirus-related shutdowns and buyers took advantage of record-low mortgage rates.
Closing transactions jumped 20.7% from the prior month to an annualized pace of 4.72 million, data from the National Association of Realtors showed Wednesday. The median forecast in a Bloomberg survey of economists called for a 4.75 million rate. Compared with a year ago, however, purchases were down 3.4% on an unadjusted basis.
“The housing market is hot. Red hot,” Lawrence Yun, NAR’s chief economist, said on a call with reporters. Homebuyers are favoring smaller towns and suburbs, perhaps because people are looking for a larger-sized home to accommodate working from home, Yun said.
The figures show a rebound in the housing market that is providing a source of support for the economy. At the same time, the pace of sales may be difficult to sustain at near pre-pandemic levels given millions of job losses and more-recent rollbacks of reopening plans in states experiencing a pickup in coronavirus cases.
