US existing home sales jump forecasts in December

Sales of second-hand homes in the States sped past forecasts at the end of 2020, taking the full-year increase to its highest level since before the Great Financial Crisis.

According to the National Association of Realtors, in seasonally-adjusted terms, existing home sales grew at a month-on-month clip of 0.7% in December to reach an annualised pace of 6.76m (consensus: 6.55m).

Economists had been anticipating a dip from the prior month figure of 6.69m.

For all of 2020, existing home sales hit 5.64, for a 5.6% increase versus 2019.

Housing inventory meanwhile shrank to a record-low of 1.07m in December or two-months' worth of sales.

NAR chief economist, Lawrence Yun, said he was confident that the strength in the housing market would extend into 2021.

"Although mortgage rates are projected to increase, they will continue to hover near record lows at around 3%," Yun said.

"Moreover, expect economic conditions to improve with additional stimulus forthcoming and vaccine distribution already underway."

The median price for existing homes also jumped, rising at a year-on-year pace of 12.9% to $309,800 with price increases seen in every region.