(Kitco News) - Gold prices fell to fresh session lows after the latest data showed the U.S. housing market improved far beyond expectations in February.
Existing home sales rose a staggering 9.5% last month against expectations for a 2.5% decline and following a revised 3.1% increase in January, according to National Association of Realtors (NAR) data published on Thursday morning.
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – rose to a seasonally adjusted annual rate of 4.38 million in February, much higher than the 3.94 million expected and well above the revised 4 million in January. Year-over-year, sales were still down 3.3% compared to February 2023.
Gold sold off sharply following the housing data, with spot gold falling from $2,200 per ounce a few minutes before the 10 am EST release to a new session low of $2,181.87 in the minutes afterward, and last traded at $2,185.82 at the time of writing, down 0.02% on the day.
Among the four major U.S. regions, sales rose month-over-month in the Midwest, South, and West and were unchanged in the Northeast.
"Additional housing supply is helping to satisfy market demand," said NAR Chief Economist Lawrence Yun. "Housing demand has been on a steady rise due to population and job growth, though the actual timing of purchases will be determined by prevailing mortgage rates and wider inventory choices."
Total housing inventory was 1.07 million units at the end of February, up 5.9% from January and up 10.3% from the 970,000 units recorded one year ago. Unsold inventory currently sits at a 2.9-month supply at the current sales pace, down from 3.0 months in January but up from 2.6 months in February of 2023.
The median home price in February was $384,500, an increase of 5.7% from the prior year's $363,600 level. All four U.S. regions posted price increases.
Economists continue to pay close attention to the U.S. housing market as it is a major contributor to economic activity. The housing sector has struggled as the Federal Reserve has aggressively raised interest rates at the fastest pace in 40 years.
