Monthly Home sales remained strong in January as buyers continued to benefit from extremely low mortgage rates. Prices also continued to rise as inventory remained low in the face of demand spurred by falling interest rates. Overall 2016 appears to be off to a strong start for existing home sales.
Interest rates declined slightly in January as struggling equities markets created downward pressure on the safe haven assets that heavily influence mortgage rates. Currently, Freddie Mac reports the following figures: 30-year fixed rate, 3.62%; 15-year fixed rate, 2.93%; 5/1-year adjustable rate, 2.79%.
The National Association of Realtors reported home sales at a seasonally adjusted annual rate of 5.47 million homes in January. This was an increase of 0.2% from the previous month and 13.5% from the previous year.
Number of Homes for Sale
The actual number of homes for sale in January was down 2.2% compared to the same month of the previous year. This combined with the sales in January led the months of supply of inventory, which measures the relationship between supply and demand, to be 4 months.