Existing home sales, as reported by the National Association of Realtors (NAR), increased 1.8% in May to the highest level since February 2007. The May share of first-time buyers, however, remained mired at 30% in May and for all of 2015. May existing sales are up 4.5% from the same month a year ago. Total existing home sales in May increased to a seasonally adjusted rate of 5.53 million units combined for single-family homes, townhomes, condominiums and co-ops, up from a downwardly revised 5.43 million units in April.
May existing sales increased in the West, South and Northeast by 5.4%, 4.6% and 4.1% respectively, while decreasing by 6.5% in the Midwest. Year-over-year, the Northeast , South and Midwest increased 11.6%, 6.5% and 3.2% respectively, while decreasing by 1.7% in the West.
Total housing inventory increased 1.4% in May, but remains 5.7% lower than its level a year ago. At the current sales rate, the May unsold inventory represents a 4.7-month supply, unchanged from April. Some 49% of homes sold in May were on the market for less than a month, the highest since May 2015.
The distressed sales share decreased to 6% in May, down from 7% in April and 10% a year ago. Distressed sales are defined as foreclosures and short sales sold at deep discounts. The May all-cash sales share dropped to 22%, down from 24% in April and one year ago. Individual investors purchased a 13% share in May, the same as April and down from 14% a year ago, and continued to follow a four year pattern of increasing at the beginning of the year and declining by spring.
The May median sales price of $239,700 was 4.7% above the same month a year ago, and represents the 51st consecutive month of year-over-year increases. The median condominium/co-op price of $229,600 in May was up 6.0% from the same month a year ago.
The Pending Home Sales Index increased 3.5% in February, 1.4% in March and 5.1% in April, so the continued upward trend in existing sales reported in May was expected. Builder sentiment remains cautiously optimistic, and the tight inventory of existing homes bodes well for new single-family sales in 2016.