Sales of previously owned homes rose more than expected in July, a sign of growing strength in the housing recovery.
Sales climbed 2.4% from June to a seasonally adjusted annual rate of 5.15 million, the National Assn. of Realtors said Thursday. The July sales level, the highest of the year, beat analysts' projected rate of 5 million.
A steadily improving job market, coupled with more options for buyers, drove sales higher last month, said Lawrence Yun, the trade group’s chief economist.
“The number of houses for sale is higher than a year ago and tamer price increases are giving prospective buyers less hesitation about entering the market,” he said.
The positive report is the latest sign the housing market may be turning a corner after starting to slow last summer amid higher mortgage rates and prices.
Earlier this week, the Commerce Department said builders in July broke ground on new homes at a 15.7% higher pace than in June. And although existing home sales remain below year-ago levels, they are steadily improving.
July marked the fourth straight month that sales, adjusted for seasonal swings, climbed from the previous month.
“Housing finally appears to be gaining solid footing,” Quicken Loans vice president Bill Banfield said.
Helping drive that improvement are mortgage rates that have fallen from last year's highs, economists say.
The average interest rate on a 30-year fixed-rate loan is at the lowest level of the year, Freddie Mac said Thursday in its weekly survey of lenders. The average rate this week for that popular mortgage dropped to 4.10%, down from 4.12% last week and 4.58% a year earlier.
The rate for a 15-year fixed-rate loan reached 3.23%, down from 3.24% a week earlier and 3.60% last year.
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