Nationwide existing home sales cooled slightly in October but remained at historically high levels as low mortgage rates helped fuel demand for home purchases, a real estate group said today.
In a separate report, the pace of existing home sales in California rose in October from the previous month but the prices edged down. The inventory of homes for sale also grew and it took longer for properties to sell.
Sales prices rose on a year-over-year basis, with the median sales price climbing 8.8% to $187,000.
Low mortgage rates once again were credited with keeping home sales strong. The national average rate for a 30-year, fixed-rate mortgage was 5.72% in October, down from 5.75% in the previous month, according to mortgage company Freddie Mac. In October 2003, the average rate was 5.95%.
"Of course all of the other market fundamentals remain sound, so we should only see a modest decline from record home sales this year if mortgage interest rates gradually rise," said NAR's chief economist David Lereah in a statement.
On a regional basis, the South was the only area to report an increase in sales activity in October, with the sales pace rising 3.7% from the previous month. Sales declined 2.8% in the Midwest, 1.3% in the Northeast and 3.6% in the West.
In California, existing home sale rose 2.1% from September to a seasonally adjusted annual rate of 639,570 properties, according to the California Association of Realtors. The median sales price dipped 0.7% to $460,370, but remained more than 21% above year-ago levels.
The real estate group also noted that the average time a house sat on the market before it sold was 37 days — the highest level since July 1999. In addition, the inventory of homes for sales rose to a nearly four month supply, compared to about a two month supply a year ago.
"This is giving buyers a greater number of options when looking for a home," CAR President Jim Hamilton said in a statement.