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"Mortgage rates dropped to below 3.00% again. Specifically, the 30-year fixed rate mortgage fell to 2.95% from 3.00% the previous week, following the trend of the 10-year Treasury yield. Although these rates at the 2% range won’t likely last long, many homebuyers can benefit from these low rates.
As a result, home sales activity remains strong. During the spring season — March, April, and May — nearly 1.4 million existing-homes are typically sold. However, about 1.0 million existing homes have already been sold so far during March and April of this year. Thus, more than 70% of the homes that are typically purchased within a 3-month period have been purchased in a 2-month timeframe this year. In addition to existing homes, about 165,000 new single-family homes have been sold during March and April. This is a 24% increase from the historical level.
Thus, although inventory is near record lows (1.16 million), more home sales are expected to occur this year. In fact, NAR forecasts existing and new home sales to rise 10% and 20% in 2021, respectively. Nevertheless, activity would be even busier if there were more homes available for sale."
