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US Home Sales Reach Fastest Pace Since Recession

US home sales reached their highest level since the recession in August, according to a report issued Thursday by the National Association of Realtors. The report showed that sales of existing homes rose 1.7 percent last month from July to a seasonally adjusted annual pace of 5.48 million homes. It marks the best sales month since February 2007, when the recession was just beginning and home sales were just starting a steady decline following the last housing bubble. On a year-over-year basis, sales were up a whopping 13.2 percent.

Economists were not shocked by August's heavy sales activity, despite the actual sales pace surpassing consensus Wall Street estimates by about 1 quarter million homes. Most assume that buyers rushed in because of the increased rhetoric about Fed unwinding of its stimulus programs aimed at keeping interest rates low. Buyers are in some cases eager to lock in at today's lower interest rates before the Fed starts tapering its bond purchases and rates go up.

The NAR's report showed the median sales price for homes sold in August was $212,100, an improvement of 14.7 percent from the same month a year ago. That marks the biggest year-over-year jump in prices since October 2005, when the bubble was still ongoing.

September 20, 2013

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