Sales of previously owned U.S. homes rose in April to the highest level in more than three years as housing continued to gain momentum.
Purchases of existing houses increased 0.6% to an annual rate of 4.97 million, the most since November 2009, the National Association of Realtors reported today in Washington. The median forecast of 79 economists surveyed by Bloomberg called for a pickup to a 4.99 million pace.
Housing has gained strength as borrowing costs near record lows and job gains rebuild confidence, spur demand and stabilize prices. The effects are rippling through the economy to give a boost to retailers including Home Depot Inc., builders, real estate brokers and mortgage lenders.
“The housing recovery remains intact,” Dean Maki, chief U.S. economist at Barclays Plc in New York, said before the report. “We believe it’s on a solid foundation.”
Economists’ estimates in the Bloomberg survey ranged from 4.85 million to 5.1 million. The prior month’s pace was revised to 4.94 million from a previously reported 4.92 million.
The median price of an existing home climbed 11% to $192,800 last month from $173,700 a year earlier, today’s report showed. Last month’s median price was the highest since August 2008.
“The price increase at double digits is not healthy because incomes are rising at less than 2%,” NAR Chief Economist Lawrence Yun said at a news conference as the figures were released. “We do need to moderate the price growth. The only way for that to occur is for more supply to come on to the market.”
The number of properties on the market climbed 11.9% to 2.16 million in April. Nonetheless, the supply was still about 14% lower than a year earlier, said Yun. At the current sales pace, it would take 5.2 months to sell those houses compared with 4.7 months at the end of March.
The median number of days on the market dropped to 46 in April from 62 the prior month, Yun said. That is the least since they began tracking the data in May 2011, and compares to an average of about 90 days, he said.
Foreclosures and other distressed sales accounted for 18% of the total, the lowest share in data going back to October 2008.
Existing-home sales are recovering after reaching a 13-year low of 4.11 million in 2008. The market peaked at a record 7.08 million in 2005. Resales accounted for about 93% of the residential market in 2012.