Home sales stir as rates fall: Existing-home sales up 1.7% in February

The Financial News, New York City – Lee Byung-chulExisting-home sales in the United States rebounded in February. Mortgage rates fell below the psychologically important 6% level, reviving demand from homebuyers.
According to the National Association of Realtors (NAR) on the 10th (local time), existing-home sales in February rose 1.7% from the previous month to an annualized pace of 4.09 million units. This sharply beat market expectations, which had called for a 1.3% decline.
Home sales had plunged about 6% in January, but turned higher again just one month later.
The latest rebound was driven by lower mortgage rates. At the end of February, mortgage rates fell below 6% for the first time since 2022. In the real estate industry, the 6% level is widely viewed as a key psychological threshold that shapes homebuying sentiment.
Lawrence Yun, chief economist at NAR, told The Wall Street Journal (WSJ), "As homebuying conditions have gradually improved, that has translated into higher sales," adding, "During the spring homebuying season, more potential buyers are visiting open houses."
However, it is unclear whether this recovery trend will continue. After the war involving the Islamic Republic of Iran (Iran), yields on U.S. Treasury securities rose, pushing mortgage rates back above 6%. If rates keep climbing, some analysts warn that the housing market’s recovery could stall again.
High home prices also remain a major drag on the market. The national median existing-home price in February was 398,000 dollars, up 0.3% from a year earlier. Although mortgage rates are lower than a year ago, many potential buyers are still hesitant to enter the market because of elevated home prices and the broader cost-of-living burden.
By region, home sales increased in the Midwest, South, and West, but declined in the Northeast. In the Northeast, harsh winter weather last month weighed on transaction activity.
Housing inventory is gradually building. The number of homes listed for sale rose 2.4% from the previous month and 4.9% from a year earlier. The increase in supply is putting some lid on overall price gains, and in some areas, prices are even starting to fall.
Real estate agents say the market is slowly shifting toward a "buyer’s market." Homes sold in February stayed on the market for an average of 47 days, up from 42 days a year earlier.

pride@fnnews.com Reporter Lee Byung-chul Reporter