Existing US home sales soar to 10-year peak in a sign of economic strength

US home resales surged to a 10-year high in January as buyers shrugged of higher prices and mortgage rates, a sign of growing confidence in the economy.

The National Association of Realtors said on Wednesday existing home sales jumped 3.3 per cent to a seasonally adjusted annual rate of 5.69 million units last month. That was the highest level since February 2007.

December’s sales pace was revised up to 5.51 million units from the previously reported 5.49 million units. Economists had forecast sales rising 1.1 per cent to a pace of 5.54 million units in January. The NAR also revised sales data going back to 2014. The revisions were minor and had no impact on the characterization of the housing market.

Prices for US government debt slipped after the data, while the dollar was little changed against a basket of currencies. The PHLX housing index rose 0.6 per cent, outperforming the broader US stock market.

Home resales were up 3.8 per cent from January 2016. Demand for housing is being underpinned by a strengthening labour market, which is improving employment opportunities for young adults and, in turn, boosting household formation.