In November existing homes sales rose to 5.82 million according to the National Association of Realtors. That was the third straight monthly increase and the largest number since 2006. There is increasing demand with diminishing supply and despite the continued push up in prices, where the median price is now $248,000; there is an annual increase of 5.8%. The end of this strong sales cycle is nowhere in sight.
There is now only 3.4 months’ supply and that is very tight. First time buyers are having a hard time entering the market. They made up only 29% of the buyers in November whereas the long term average is 40%. That may mean continued demand coming from that portion of buyers.
What could change this Goldilocks moment is mortgage rates that are scheduled to rise as the FED continues to push up the Fed Funds Rate into 2018.