Despite the promising pace existing-home sales began 2017 with, February's numbers showed a slight decline, according to the National Association of Realtors.
Total existing-home sales fell to 5.48 million in February, a 3.7% drop compared to January's figures. Compared to February 2016, however, last month showed a 5.4% increase.
On a regional basis, only one area of the country saw an uptick in home sales compared to January. Southern sales increased 1.3% to a rate of 2.34 million. The Midwest, Northeast and West didn't fare so well.
In the Midwest, sales slid 7% to 1.2 million. Northeastern sales decreased 13.8% to just 690,000. And sales in the West fell 3.1% to 1.25 million.
One of the biggest factors keeping home sales back is a lack of affordable inventory. At the end of January, the country had 1.69 million existing homes, representing a 2.4% increase over December's, but a decrease of 7.1% compared to the end of January a year before. Total available inventory in February increased to 1.75 million - about a 3.8-month supply.
Given the high demand and low availability, home prices continue to increase. The median cost of an existing home in February was $228,400, marking a trend of year-over-year price increases that has been ongoing for five years. Compared to February 2016, home prices last month were 7.7% higher.
"Homebuyers need to get prepared early for their home purchase."
Between lack of available housing, high demand and rising prices, now is an ideal time to put a home up for sale. The warmest months of the year are just around the corner, and more people will begin house hunting. With market factors favoring the seller, it's important that buyers get prepared early for their home purchase.
"Seek a preapproval from a lender, know what your budget is and begin discussions with a Realtor® early on about your housing wants and needs," implored William E. Brown, NAR's president and a California-based realtor, according to NAR. "Homes in many areas are selling faster than they were last spring. A buyer's idea of a dream home in a popular neighborhood is probably the same as many others. That's why they'll likely have to decide quickly if they see something they like and can afford."
As summer approaches, prospective homebuyers should prepare for a purchase. First, look in neighborhoods and cities in which you'd like to live. Get a good idea of how much homes cost there and how far of a commute you'd need to take to work, school and the grocery store. Find out what types of homes and amenities are nearby, and check the quality of the school district.
Once you've begun your research, take a close and honest look at your finances. Calculate how much you can realistically pay upfront. This will determine how much you can afford and will factor into what sort of residential mortgage you qualify for.
Speak to your mortgage lender for more information about the loan products you are eligible for. You may opt for an FHA loan or VA loan if it's available to you to reduce costs.
Academy Mortgage is one of the top independent purchase lenders in the country as ranked in the 2015 CoreLogic Marketrac Report. Visit www.academymortgage.com to find a loan, get a rate, or calculate your payment today.