Home sales during the month of May reached a six-year high with first-time home buyers helping to drive the market, according to the National Association of Realtors ‘ (NAR) latest report. The association referred to the increase in first-time buyers as an “encouraging sign” for the housing market.
The market share of first-time home buyers rose to 32% of transactions during May, matching the highest share since September 2012. During the same time last year, first-time buyers represented 27% of all buyers, NAR reported.
“The return of first-time buyers in May is an encouraging sign and is the result of multiple factors, including strong job gains among young adults, less expensive mortgage insurance and lenders offering low down payment programs,” Lawrence Yun, NAR’s chief economist, said. “More first-time buyers are expected to enter the market in coming months, but the overall share climbing higher will depend on how fast rates and prices rise.”
Total existing-home sales – homes sold by your neighbors, not developers – climbed 5.1% to a seasonally adjusted annual rate of 5.35 million in May. Sales are up 9.2% compared to the same time last year. However, inventory remains tight, with 45% of homes sold in May were on the market for less than a month, according to NAR.
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