WASHINGTON (Reuters) – U.S. home resales fell in December to their lowest level in 12 years but the recent decline in real estate interest rates combined with slowing growth in the median price of goods is fueling hope for a recovery in the sector.
The National Association of Realtors (NAR) on Friday reported a 1.5% drop in resales last month to 4.02 million annualized, the lowest since November 2010.
Economists polled by Reuters on average expected home resales to decline to 3.96 million from 4.09 million in November.
These sales have thus been declining for eleven consecutive months, a cycle not seen since 1999.
The rise in the cost of credit in the United States, which began in March 2022, weighs on the real estate market while several officials of the American Federal Reserve plead for a continuation of the rise in the cost of money beyond 5% against inflation deemed still too high.
The average rate on a 30-year home loan fell to 6.15% this week, the lowest level since mid-September, according to data from mortgage finance agency Freddie Mac. It was 6.33% the previous week and 7.08% at the start of the fourth quarter, its highest level since 2002.
The median resale price of a home continues to rise, 2.3% year on year in December, to $366,900, but this is the smallest increase since May 2020.
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(Report Lucia Mutikani; French version Claude Chendjou, edited by Blandine Hénault)
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