US existing home sales rise to highest level since 2007 in May

Sales of existing US homes rose to a nine-year high in May, according to data from the National Association of Realtors.

Sales were up 1.8% to a seasonally-adjusted annual rate of 5.53m from a downwardly revised 5.43m in April. This was a touch weaker than economists had expected.

Sales were up 4.5% from May 2015, at their highest annual pace since February 2007. Meanwhile, the median price for a home rose 4.7% from last May to $239,700.

Lawrence Yun, NAR chief economist, said: “This spring's sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more homeowners realizing the equity they've accumulated in recent years and finally deciding to trade-up or downsize.

"With first-time buyers still struggling to enter the market, repeat buyers using the proceeds from the sale of their previous home as their down payment are making up the bulk of home purchases right now."