Low mortgage rates drive record housing market rebound of 20% in June 2020

Low mortgage rates drive record housing market rebound of 20% in June 2020

The economy may be on life support due to COVID-19, but housing sales across the nation soared in June 2020, according to a report from the National Association of Realtors. It found that housing sales increased about 20% nationwide compared to sales in May – the largest single-month recovery since the organization began collecting data.

The bump was the consequence of reopening the economy and mortgage rates that dipped below 3%.

"We've never seen mortgage rates this low," said Gay Cororaton, the association's director of housing and commercial research.
"That's really making a home affordable."

Low mortgage rates mean a family could pay about $1,000 a month for a median-priced house – $295,300 – with 20% down, Cororaton said. This helped drive a small uptick in first-time homebuyers in June.

Cororaton also noted a reduction in investment buyers.

"They're concerned about renters' ability to meet the rent payment," she said.
"Investment buyers and second-home buyers made up just 9% of the market this June compared to 15% last month."

Cororaton warns that the market may slow down in July as cases of COVID-19 surge and some states reenter partial lockdowns.
The US market is still down 11% compared to housing sales in June 2019.