FILE - In this Aug. 16, 2019, file photo an under contract sign is displayed along Park Avenue in Richmond, Va. On Thursday, Sept. 19, the National Association of Realtors reports on sales of existing homes in August. (AP Photo/Steve Helber, File)

Mortgage rates boosted US home sales 1.3% in August

September 19, 2019 - 9:01 am

WASHINGTON (AP) — U.S. home sales rose 1.3% in August to the highest level in 17 months, as mortgage rates near historic lows have spurred a rush of home-buying.

The National Association of Realtors says homes sold last month at a seasonally adjusted annualized rate of 5.49 million units, the best performance since March 2018. Sales have increased 2.6% from a year ago. Cheaper borrowing costs have increased affordability for buyers, but they have also led to higher prices as there is a shortage of properties for sale.

The median sales price climbed 4.7% from a year ago to $278,200, outpacing average wage gains.

Economic uncertainty has reduced interest rates, helping homebuyers. The 30-year mortgage rate averaged 3.56% this week, down from 4.6% a year ago, according to mortgage buyer Freddie Mac.

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