Bloomberg: Sales of Previously Owned Homes Drop in February

A lack in inventory leads to existing home sales falling by 3.7 percent.

Existing home sales started off the year strong by rising to the highest level in a decade in January. But that trend didn’t continue in February.

Last month, sales of previously owned homes dropped 3.7 percent to a 5.48 million annual rate in the U.S. That limit on housing demand is due to a lack of inventory—the number of available properties fell 6.4 percent from February 2016 to 1.75 million. That’s the 21st straight year-over-year decline. The lack of inventory is also driving home prices up. The median sales price increased 7.7 percent from the year before to $228,400.

During a press conference, Lawrence Yun, NAR’s chief economist, said, “The speed of transactions is very fast and we know that there’s an inventory shortage. Buying interest remains very solid and strong but we have a bottleneck. We don’t have enough inventory to satisfy that buying interest.”

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