Home sales in the US were up in November, marking the third straight month of increase. The unexpected rise was attributed to the increase in mortgage rates, forcing potential buyers into sales to ahead of further increments. The turnaround of the sector is expected to add to economic growth this quarter, in contrast to its underperformance in the second and third quarters of this year. The report released by the National Association of Realtors came on Wednesday, said that sales in previously owned homes were up by 0.7 percent, bringing the seasonally adjusted annual rate up to 5.61 million, making it the highest sales rate since February 2007.
Despite the best performance in the market since the recession, prices are higher than expected, as supply remains low. The median price was $234,900, which is 6.8 percent higher than a year ago. Sales are 15.4 percent higher than what they were the same time last year, but the outlook for 2017 is still gloomy. The Federal Reserve has announced three possible rate hikes next year. The market has had a strong response to Trump’s victory, which pushed mortgages up, due to the expectation of increased spending on infrastructure when he takes office.
First time buyers accounted for 32 percent of the sales, which occurred mainly in the Northeast and South. Sales in the Midwest and West were down last month. The economic forecast had predicted a 1 percent dip for the month, to bring it down from the 5.57 million in October to 5.5 million for November. The labour market and the economy on a whole are performing strongly, leading economists to believe the growth might increase in December as well. At the current rate, available homes are meant to be exhausted within the next four months.