US existing home sales shot up 6.7% in January: report
Home for Sale AFP/File / JOE RAEDLE

Existing homes have become harder to find than ever, but Americans kept buying in January, pushing the pace of sales up much more than expected, according to industry data released Friday.

Existing homes sales jumped 6.7 percent last month to a seasonally-adjusted annual rate of 6.5 million, even as the inventory of homes for sale hit a new all-time low, the National Association of Realtors (NAR) said.

The real estate market has boomed during the Covid-19 pandemic thanks in part to the Federal Reserve's easy money policies, causing property prices to climb and inventory to grow scarce.

With the Fed next month set to hike interest rates for the first time since the crisis began to fight runaway inflation, of which home sales are a part, NAR Chief Economist Lawrence Yun said shoppers scrambled to get deals.

"Buyers were likely anticipating further rate increases and locking-in at the low rates, and investors added to overall demand with all-cash offers," Yun said."Consequently, housing prices continue to move solidly higher."

Median existing home prices climbed to $350,300, 15.4 percent higher than the same month last year and the 119th consecutive year-on-year increase, which NAR said was the longest streak on record. Inventory dropped to a supply of 1.6 months at the most-recent pace of sales.

Yun warned that homes under $500,000 "are disappearing" and much of the new supply is of higher-priced homes.

Sales grew in all regions, with the South seeing an increase of 9.3 percent and the Northeast growing 6.8 percent. The Midwest and West rose just over four percent.