Sales of previously owned homes rose for a third straight month in June, pushing activity to the highest level in eight months and providing evidence that housing is regaining lost momentum.
The National Association of Realtors said Tuesday that sales of existing homes increased 2.6 percent to a seasonally adjusted annual rate of 5.04 million homes. It marked the first time that sales have been above the 5 million-mark since October.
Even with the three months of increases, however, sales were still 2.3 percent below the sales rate in June of last year.
Sales peaked in July last year and then lost momentum as mortgage rates rose from extremely low levels. Sales were further hurt by an unusually severe winter.
After peaking at 5.38 million units last July, sales had been falling as mortgage rates climbed from historic lows after then-Fed Chairman Ben Bernanke indicated in June that the central bank could begin trimming its monthly bond purchases later in the year.
The Fed did start reducing the bond purchases in December but mortgage rates have actually retreated as financial markets realized the Fed intended a gradual reduction of the long-interest rate support it has been providing the economy. Rates on 30-year mortgages stood at 4.12 percent last week.
The median price of a home sold in June was $223,300, up 4.3 percent from a year ago.
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