The housing market has been gaining stability over the past month. According to the National Association of Realtors, sales of previously owned homes increased 4.9% from April to May, for an annual rate of 4.89 million sales.
This has been the largest increase in home sales since August 2011, and it also surprised industry experts who had predicted a more gradual gain of 4.75 million sales.
Over the past few months, the housing recovery has been lagging. Home prices and mortgage rates rose at the same time, which led to a slow market as potential buyers decided to wait opting in. The news of the recent growth has spurred hope in an industry that has, so far, had to deal with several major blows in a row thanks to the ongoing impact of the Recession.
Industry insiders say that buyers are returning thanks to stabilized mortgage rates, as well as an increasing number of homes on the market, which gives buyers more options. “A more balanced market… may encourage more Americans to buy as employment strengthens,” predicts Bloomberg. In May, the median home price was $213,400. At 5.1% higher than the median a year before, it represents the smallest annual increase since March of 2012. “The temporary pause in rising interest rates and more homes for sale is good news — especially for first-time home buyers,” said Realtor’s president, Steve Brown, in a released statement.
While some might remain hesitant about the housing market, national economists see the price slowdown as an indication of sustainable growth and bubble avoidance, and not a sign of future declines in value. “The housing recovery is going to continue,” said Tom Simone, an economist working out of New York. Homeowners selling their homes can see this as a positive sign, and can look for ways to better their own chances of selling — it’s worth noting that updated kitchens are listed as a top “must have” for new home buyers.