Sales of existing homes remained steady in October at their highest level since last January as mortgage interest rates continued to fall, a real estate trade group said today.
The National Assn. of Realtors said existing single-family homes sold at a seasonally adjusted annual rate of 3.52 million, the same as September's revised rate and the highest since the 3.55 million rate at the beginning of the year. The September rate was 1.2% more than August's 3.48 million sales.
Fixed-rate mortgages fell steadily from 10.10% to 9.82% during October, according to the Federal Home Loan Mortgage Corp.
"Lower rates are sustaining sales at a healthy clip," said Norman D. Flynn, association president. "Buyers priced out by higher rates earlier this year are in the market now."
For a year, the Federal Reserve had pushed interest rates higher to battle inflationary pressures. But since last spring, the central bank has been gradually easing its grip on credit, allowing mortgage rates and a variety of other consumer and business loan rates to fall.
John A. Tuccillo, chief economist for the realtor group, predicted that mortgage rates will remain low into next year, providing buying opportunities for less affluent buyers and keeping existing-home sales steady.
The national median price for an existing single-family home was $92,100, down $2,200 from September. The median price means that half the homes sold for more, half for less.
The West posted the only increase in sales in October, up 3.4% to an annual rate of 610,000 units, the association said. The median price for a home in the West was $142,200, $5,400 less than the September cost.