There is a lot of upbeat news in the September 2016 existing home sales report released by the National Association of Realtors® (NAR) on Thursday.
Sales rebounded sharply and the improvement was seen in all four regions. More good news, NAR attributed part of that to increased participation from first-time home-buyers, a group that has worried the housing industry by its relative absence.
Total existing home sales during the month, including single-family homes, town homes, condos, and co-ops, rose 3.2 percent to a seasonally adjusted annual rate of 5.47 million. First-time buyers accounted for 34 percent of sales, the highest portion in more than four years.
Consumer confidence reached its highest level since the Great Recession in September, according to the Thomson Reuters and University of Michigan Surveys of Consumers.
September’s increase in consumer confidence is the result of optimistic outlooks on the overall economy and personal incomes. The consumer expectations index rose 5.8 percent over the month of September, while the current conditions index fell 0.9 percent.
Additionally, a growing number of consumers expect their incomes to increase over the next year. The median income growth expectation reported in September was 1.1 percent, which is the highest expectation since late 2008. At the same time, more households anticipate income growth now than at any time since September 2008.
The renewal of income growth is particularly important for sparking consumer spending, and adding pending changes to monetary policy will make income gains prompt to boost even more consumer’s confidence.