After reporting a sharp increase in U.S. existing home sales in the previous month, the National Association of Realtors released a report on Thursday showing existing home sales pulled back by much more than expected in the month of January.
NAR said existing home sales plunged by 8.4 percent to an annual rate of 3.91 million in January after surging by 4.4 percent to a downwardly revised rate of 4.27 million in December.
Economists had expected existing home sales to tumble by 3.5 percent to an annual rate of 4.20 million from the 4.35 million originally reported for the previous month.
“The below-normal temperatures and above-normal precipitation this January make it harder than usual to assess the underlying driver of the decrease and determine if this month’s numbers are an aberration,” said NAR Chief Economist Dr. Lawrence Yun.
The report also said housing inventory at the end of January totaled 1.22 million units, down 0.8 percent from 1.23 million units in December but up 3.4 percent from 1.18 million units a year ago.
The unsold inventory represents 3.7 months of supply at the current sales pace, up from 3.5 months in December and in January 2025.
Meanwhile, NAR said the median existing home price slumped by 2.1 percent to $396,800 in January from $405,100 in December but climbed by 0.9 percent from $393,400 a year ago.
“Due to low supply, the median home price reached a new high for the month of January,” Yun said. “Homeowners are in a financially comfortable position as a result. Since January 2020, a typical homeowner would have accumulated $130,500 in housing wealth.”
Next week, the Commerce Department is scheduled to release separate reports on new residential construction and new home sales in the months of November and December.
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