US existing-home sales rebounded in December from a November slump, led by gains in the key single-family home sector, the National Association of Realtors said Friday.
Total sales of used homes rose 2.4 percent from November to an annual rate of 5.04 million in December, climbing above the five-million mark for the sixth time in seven months despite low inventory on the market, NAR said.
Total inventory at the end of December tumbled 11.1 percent to 1.85 million existing homes, a 4.4 month supply at the current sales pace, slowing from 5.1 months in November.
"A drop in housing supply in December raises some affordability concerns in the months ahead as minimal selection and the potential for faster price appreciation could offset the demand from buyers encouraged by a stronger economy and sub-4 percent interest rates," said Lawrence Yun, NAR's chief economist.
The median price for an existing home rose to $209,500 in December, up 6.0 percent from a year ago. Prices have risen year-over-year for 34 months in a row.
For all of 2014, existing-home sales totaled 4.93 million, down 3.1 percent from 2013. The median home price hit $208,500, the highest level since 2007 and up 5.8 percent year-over-year.
Sales of single-family homes, the largest share of the market, rose 3.5 percent in December, and were up 4.0 percent from a year ago. Condominium and co-op sales slumped 5.0 percent last month and were unchanged on an annual basis.
"The underlying path of activity looks about flat, consistent with the low and steady trend in mortgage applications. Rapid payroll growth is increasing the pool of potential homebuyers but mortgage lending conditions are still tight and we see little near-terms scope for a real revival in housing activity," said Ian Shepherdson of Pantheon Macroeconomics.
"Homes are still selling a bit more quickly than a year ago but overall, the market is moving sideways."