Home sales in the U.S. jumped in the first month of 2022, while the number of homes for sales hit a new record low.

Existing home sales rose 6.7% to a seasonally adjusted 6.50 million million units in January from a month earlier, the highest rate in 12 months, according to the National Association of Realtors (NAR). The number of sales was down 2.3% from the same month a year ago. Home sales in December were revised down to 6.09 million from 6.18 million. The results far exceeded analysts' expectations of a 1.3% month-over-month decline to 6.1 million units, according to Bloomberg consensus estimates.

“Buyers were likely anticipating further rate increases and locking-in at the low rates, and investors added to overall demand with all-cash offers,” said Lawrence Yun, NAR’s chief economist. “Consequently, housing prices continue to move solidly higher.”

The median existing-home price for all housing types in January was $350,300, up 15.4% from January 2021 ($303,600), as prices rose in each region. Home prices were driven up by sales of more expensive homes priced above $500,000.

“The narrative is the same, few sales are occurring in the low end because of the lack of inventory,” said Yun, adding that homes priced at $500,000 and below are disappearing, while supply has risen at the higher price range. He noted that such increases will continue to shift the mix of buyers toward high-income consumers.

The number of sales for homes under $100,000 fell 17% from a month ago, compared to sales for homes between $250,000 to $500,000 and $500,000 to $750,000 rose 4% and 26%, respectively. Meanwhile sales of homes between $750,000 to $1 million and homes above $1 million increased 33% and 39%, respectively.

“There are more listings at the upper end — homes priced above $500,000 — compared to a year ago, which should lead to less hurried decisions by some buyers,” Yun added. “Clearly, more supply is needed at the lower-end of the market in order to achieve more equitable distribution of housing wealth.”

The share of first-time homebuyers was 27% in January, one of the lowest observed (the lowest was 26% in November 2021), according to Yun. That was down from 30% in December.

Sales activity was likely driven by investors or second-home buyers, which represented 22% of sales, up from 17% in December and 15% a year ago, said Yun, adding that all cash-deals, which tend to be linked to investors, accounted for 27% of transactions, compared to 23% in December and 19% the same month a year earlier.

Total housing inventory at the end of January was 860,000 units, down 2.3% from December and down 16.5% from one year ago (1.03 million) — a record low since the NAR started tracking the data in 1999 for all types of homes.