Home Sales Unexpectedly Climb on Rush to Lock in Rates

Posted by Bloomberg

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Sales of previously owned U.S. homes unexpectedly rose in August to the highest level in more than six years as buyers rushed to lock in interest rates before they increased further.

Purchases climbed 1.7 percent to a 5.48 million annual rate, the most since February 2007, figures from the National Association of Realtors showed today in Washington. The median forecast of 79 economists in a Bloomberg survey called for 5.25 million. Other figures showed Philadelphia-area manufacturing expanded at the strongest pace since March 2011.

The median selling price of an existing home increased 14.7 percent from a year ago to $212,100, today’s report showed. That was the biggest gain since October 2005.

Lawrence Yun, chief economist at the Realtors group, said the surge in sales in August was probably the “last hurrah” for the next year to 18 months as higher prices and the increase in mortgage rates hurts affordability for some buyers.