Existing-home sales jumped 9.5% in February, the highest monthly increase in a year, according to the National Association of Realtors (NAR). Monthly sales were unchanged in the Northeast but climbed in the West, South, and Midwest. Year-over-year sales were down 3.3%, with every region posting declines. The median existing-home sales price, meanwhile, increased 5.7%, marking the eighth month in a row of year-over-year increases.

Inventory Dynamics
According to NAR economists, additional housing supply helped to fulfill demand and boost sales. By the end of February, there were 1.07 million units available for sale, up from 5.9% from a month ago and 10.3% from a year ago. At the current sales pace, this level of inventory would supply the market for 2.9 months, down from a 3.0-month supply in January but up from a 2.6-month supply in February 2023.

What’s Driving the Market?
Regional disparities may still exist, as constricted inventory might have led to stagnant sales—yet high prices—in the Northeast in February. Ultimately, home sales depend on a variety of factors beyond mere market demand. “Housing demand has been on a steady rise due to population and job growth,” according to NAR chief economist Lawrence Yun, “though the actual timing of purchases will be determined by prevailing mortgage rates and wider inventory choices.” More supply is still needed to stabilize home prices and meet demand.

Buyer Behavior
According to the REALTORS Confidence Index, the average property remained on the market for 38 days in February, up from 34 days a year ago. Fewer first-time buyers were purchasing those properties; this segment of the market accounted for 26% of all transactions in February, down from 27% a year earlier. According to the NAR “2023 Profile of Home Buyers and Sellers,” first-time buyers represented 32% of all buyers in 2023. More all-cash buyers made purchases in February, with cash sales accounting for 33% of all transactions, up from 28% a year ago. Distressed sales, meanwhile, remained stable, with foreclosures and short sales accounting for just 3% of all sales.

Regional Breakdown

• Northeast: Existing-home sales annual rate of 480,000; unchanged from January 2024 but a decrease of 7.7% from February 2023. The median sales price of $420,600 represented an 11.5% increase from February 2023.

• Midwest: Existing-home sales annual rate of 1.03 million; an increase of 8.4% from January 2024 but a decrease of 3.7% from February 2023. The median sales price of $277,600 represented a 6.8% increase from February 2023.

• South: Existing-home sales annual rate of 2.02 million; an increase of 9.8% from January 2024 but a decrease of 2.9% from February 2023. The median sales price of $354,200 represented a 4.1% increase from February 2023.

• West: Existing-home sales annual rate of 850,000; an increase of 16.4% from January 2024 but a decrease of 1.2% from February 2023. The median sales price of $593,000 represented a 9.1% increase from February 2023.