(RTTNews) - Citing falling mortgage rates, the National Association of Realtors released a report on Thursday showing an unexpected jump in U.S. existing home sales in the month of August.
NAR said existing home sales surged up by 1.3 percent to an annual rate of 5.49 million in August after spiking by 2.5 percent to a rate of 5.42 million in July.
The continued increase came as a surprise to economists, who had expected existing home sales to pull back by about 0.4 percent.
"Buyers are finding it hard to resist the current rates," said NAR chief economist Lawrence Yun. "The desire to take advantage of these promising conditions is leading more buyers to the market."
The report said the median existing home price in August was $278,200, down 0.8 percent from $280,400 in July but up 4.7 percent from $278,200 a year ago. August's price increase marks the 90th straight month of year-over-year growth.
"Sales are up, but inventory numbers remain low and are thereby pushing up home prices," said Yun. "Homebuilders need to ramp up new housing, as the failure to increase construction will put home prices in danger of increasing at a faster pace than income."
NAR said total housing inventory fell to 1.86 million existing homes available for sale at the end of August, representing 4.1 months of supply at the current sales pace.
The report also said single-family home sales surged up by 2.9 percent to a rate of 4.90 million, while existing condominium and co-op sales jumped by 1.7 percent to 590,000.
Next Wednesday, the Commerce Department is scheduled to release a separate report on new home sales in the month of August.