After reporting a sharp increase in U.S. existing home sales in the previous month, the National Association of Realtors released a report on Wednesday showing that existing home sales saw further upside in June to reach their highest level in over eight years.
NAR said existing home sales climbed 3.2 percent to an annual rate of 5.49 million in June from a downwardly revised 5.32 million in May.
Economists had expected existing home sales to edge up to an annual rate of 5.40 million in June from the 5.35 million originally reported for the previous month.
With the bigger than expected increase, existing home sales are now are their highest level since reaching 5.79 million in February of 2007.
NAR also said existing home sales are up by 9.6 percent compared to the same month a year ago, reflecting the ninth consecutive month of year-over-year growth.
Lawrence Yun, NAR chief economist, said, "Buyers have come back in force, leading to the strongest past two months in sales since early 2007."
"This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy," he added.
The report also said the median existing home price for all housing types was $236,400 in June, which is up 3.3 percent from $228.900 in May and up 6.5 percent from $222,000 in the same month a year ago.
NAR said the increase lifted the median existing home price above the peak sales price of $230,400 seen in July of 2006.
"Limited inventory amidst strong demand continues to push home prices higher, leading to declining affordability for prospective buyers," Yun said.
The report said there were 2.30 million existing homes available for sale at the end of June, up 0.9 percent from 2.28 million at the end of the previous month.
NAR said the unsold inventory represents 5.0 months of supply at the current sales pace, down from 5.1 months in May.
Single-family home sales increased 2.8 percent to an annual rate of 4.84 million in June, while existing condominium and co-op sales jumped 6.6 percent to a rate of 650,000.
Friday morning, the Commerce Department is scheduled to release a separate report on new home sales in the month of June.
Economists currently expect new home sales to edge up to an annual rate of 550,000 in June after climbing to a seven-year high of 546,000 in May.
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