US home sales fell 1.3% in January

Business

FILE – This April 13, 2019, file photo, shows rows of homes, in suburban Salt Lake City. Americans took out nearly $150 billion in loans backed by the Federal Housing Administration to buy homes in 2018. Nearly 83% of those FHA borrowers were first-time home buyers, according to the Department of Housing and Urban Development. (AP Photo/Rick Bowmer, File)

February 07 2021 03:30 pm
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WASHINGTON (AP) — U.S. home sales retreated 1.3% in January from the prior month, but low mortgage rates helped enable an increase in purchases from a year ago.

The National Association of Realtors said Friday that sales of existing homes slipped last month to a seasonally adjusted annual rate of 5.46 million. Sales have climbed 9.6% over the past 12 months as borrowing costs have fallen. But sales could be squeezed in the coming months because of a shortage of homes listed for sale.

Just 1.42 million homes were on the market at the end of January, a 10.7% decline from a year ago. With fewer homes for sale, would-be buyers have fewer options and prices are rising faster than wage growth.

The median sales price in January was $266,300, up 6.8% from a year ago.

Still, a solid economy and low mortgage rates are boosting demand for housing. Workers have an increased sense of security with the unemployment rate hovering near a half-century low at 3.6%. Meanwhile, the average interest rate charged on a 30-year mortgage was 3.49% this week, down from 4.35% a year ago, according to mortgage buyer Freddie Mac.

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