The housing rebound extends beyond builders -- from home- furnishings retailers like Lowe’s Cos. and Home Depot Inc. to building materials supplies such as gypsum wallboard-maker USG Corp.
“The housing market is on the move,” Richard Fisher, president of the Federal Reserve Bank of Dallas, said today on Bloomberg Radio’s “Hays Advantage” with Kathleen Hays. “The housing sector is vital to the American economy.”
Existing-home sales have improved after reaching a low of a 3.39 million annual rate in July 2010. In the buildup to the subprime lending collapse and recession, purchases reached a peak of 7.25 million in September 2005.
Estimates in the Bloomberg survey for August ranged from 4.45 million to 4.85 million. Compared with a year earlier, purchases increased 11 percent in August, today’s report showed.
The median price of an existing home climbed 9.5 percent to $187,400 from $171,200 in August 2011. Prices have increased in each of the past six months on a year-to-year basis, the best performance since early 2006.
The increase in prices reflects both a reduction in distressed sales and a “genuine” appreciation in property values, Lawrence Yun, NAR chief economist, said in a news conference today as the figures were released.
The gain in home values may induce potential buyers and sellers to enter the market. Prices last quarter posted their first year-over-year gain since 2007, according to Zillow Inc., the Seattle-based operator of the largest real-estate information website.
Higher real estate values also helped more than 1.3 million homeowners regain equity in the first six months of 2012, according to CoreLogic. About 22.3 percent of homeowners with a mortgage owed more than their homes were worth at the end of June, down from 23.7 percent three months earlier.
Even with pricier real estate, homes remain affordable. The average rate on a 30-year fixed mortgage was at 3.55 percent in the week ended Sept. 13, near 3.49 percent, the lowest since records began in 1971, Freddie Mac data show.
The Federal Reserve has also committed to purchasing $40 billion of mortgage debt a month to lower borrowing costs, helping the housing market that Chairman Ben S. Bernanke called “one of the missing pistons in the engine.”