Sales of new and existing homes have jumped this year, driven by low mortgage rates and a desire for more living space during the pandemic. Sales of existing homes are up 16% in the first eight months of 2021 compared with last year, and they’re up 12% from the same period in 2019.
The rising prices are making it harder for younger would-be buyers to purchase a home, with the proportion of sales going to first-time homebuyers falling to 29% last month, the lowest since January 2019, according to the National Association of Realtors. Meanwhile, investors snapped up 15% of homes in August, up slightly from a year earlier.
There are some signs that home demand is cooling, and sales ticked down last month. Fewer buyers are waiving home inspections, the NAR says. Still, 87% of homes are being purchased after less a month on the market.
There were just 1.29 million homes for sale in August, according to the NAR. That’s down nearly one-third from a year earlier.
The S&P CoreLogic Case-Shiller 20-city home price index surged 19.9% in July compared with a year ago, the largest gain on records dating back to 2000. In 17 of the 20 cities, prices rose more quickly in July than in June. And prices reached all-time highs in 19 of 20 cities. The one exception was Chicago, where prices are just 0.3% below their 2006 peak.
Phoenix, San Diego, and Seattle reported the biggest price increases, with Phoenix leading the nation for the 26th straight month.