US existing home sales rose sharply by 6.7% in January. This brought the 12-month rolling sales number to 6.50M from 6.09M in December, above the expected 6.10M. The median price of homes sold was $350,000, up 15.4 percent year on year.
While mortgage rates are rising, the continuation of sales in the housing market is positive. Wages still lag behind inflation, but the high momentum in the increases seems to offset the negative impact of high interest costs in terms of affordability for now. The tightening of monetary policy is critical in this sense. We will see that sales in the housing market lose a certain amount of momentum as interest rates rise. The Fed is moving to raise interest rates, and mortgage rates will rise with it. It is very likely that we will see a housing market that will be affected by the interest and cost phenomenon.
Kaynak: Tera Yatırım
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