Existing home sales--including single-family homes, town homes, condominiums and co-ops-- rose 1.8% in May to a seasonally adjusted annual rate of 5.53million, according to a National Association of Realtors release Wednesday morning. This is the third straight month that existing home sales have risen in 2016.

"This spring's sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more homeowners realizing the equity they've accumulated in recent years and finally deciding to trade-up or downsize," said Laurence Yun, NAR chief economist, in a statement. "With first-time buyers still struggling to enter the market, repeat buyers using the proceeds from the sale of their previous home as their down payment are making up the bulk of home purchases right now."

Sales of existing single-family homes continued to climb up in May to a seasonally adjusted rate of 4.9 million, up 1.9% month-over-month, and 4.7% year-over-year. This is also the third straight month that single-family resales rose after being slowed by a huge deficit of housing inventory in February. The robust resale market mirrorsthe positive outlook among consumers regarding the future housing market reported by BUILDER and the bleak news on the labor market earlier this month.

"Barring further deceleration in job growth that could ultimately temper demand from these repeat buyers, sales have the potential to mostly maintain their current pace through the summer," Yun commented.

Median Existing Single-Family Home Prices

United States:
May 2016: $241,000
May 2015: $230,500
Y-o-Y Percent Change: 4.6%

May 2016: $269,200
May 2015: $270,500
Y-o-Y Percent Change:-0.5 %

May 2016: $191,200
May 2015: $182,600
Y-o-Y Percent Change: 4.7%

May 2016: $216,200
May 2015: $204,200
Y-o-Y Percent Change: 5.9%

May2016: $348,100
May 2015: $325,800
Y-o-Y Percent Change: 6.8%

The steady rebound in single-family sales is largely driven by gains in the Northeast, South, and West, where sales picked up month-over-month by 4.8%, 4.7%, and 5.2%, respectively. The Midwest is the lone state that saw sales of single-family homes drop, down -6.2% from the previous month. By sales volume, the South remains the biggest pre-owned single-family market, ending this month with a strong 2 million sales.

Inflated home prices resulting from restrained inventories are hampering potential buyers. The median price for a pre-owned single-family home rose 4.6% year-over-year to $241,000 in this month, with the West being the most expensive region ($348,100), followed by the Northeast ($269,200), South ($216,200), and Midwest ($191,200).

The following is a breakdown of percent change of sales by price range in the existing single-family market. Most homes saw notable gains across all regions in this month, with those middle-to-higher tier of homes between $250,000 and $750,00 reporting the strongest result. Sales of lower-tier homes priced below $100,000 still had a hard time in the West and South.

Total housing inventory at the end of May increased 1.4% to 2.15 million existing homes available for sale, but is still 5.7% lower than a year ago. Unsold inventory is at a 4.7-month supply at the current sales pace, roughly on par with April.

Read the full release on NAR >>