Today, the National Association of Realtors (NAR) released their Existing Home Sales Report for December showing unusually strong sales with total home sales jumping 14.7% since November climbing 7.7% above the level seen in December 2014.
Single family home sales also increased notably with sales surging 16.1% from November and climbing 7.1% above the level seen in December 2014 while the median selling price increased 8.0% above the level seen a year earlier.
Inventory of single family homes decreased notably, falling 12.7% from November to 1.58 million units, 3.7% below the level seen in December 2014 which, along with the sales pace, resulted in a notably tight monthly supply of 3.9 months.
While NAR cites December's surge in sales coming from effects of the implementation of the "Know Before You Owe" regulations, in all likeliness, much this surge in home buying has come as a result of buyers coming off the sidelines in the face of increased rates as the Fed initiated the long awaited "lift off" in December.
It will be interesting to see to what extent this buying will persist in coming months particularly in light of additional speculation of Fed rate hikes.
It's important to note that there has been little to no movement in the 30-Year Conventional Mortgage rate since the Fed's December announcement which clearly affirms the fact that while the Fed is seeking to guide the short end of the rate curve up, they are also still working to tether the long end down by reinvesting principle payments coming from past MBS purchases back into mortgage additional new mortgage backed securities.
The following charts (click for full-screen dynamic version) shows national existing single family home sales, median home prices, inventory and months of supply.