After a double-digit, year-over-year jump in sales in July, existing-home sales continued to post increases in August, according to the latest monthly report from the National Association of Realtors.

Sales of existing single-family, townhomes, condominiums and co-ops in August rose 18.6 percent from a year ago to a seasonally adjusted annual rate of 5.03 million. Sales also rose on a monthly basis, up 7.7 percent from an upwardly revised 4.67 million in July. Unsold inventory fell 3 percent in August to 3.58 million — an 8.5-month supply at the current sales pace.

“Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” said Lawrence Yun, NAR’s chief economist, in a statement. “Investors were more active in absorbing foreclosed properties. In additional to bargain hunting, some investors are in the market to hedge against higher inflation.”

Investors and first-time buyers accounted for 22 percent and 32 percent of purchases in August, respectively. Cash buyers, the bulk of which are investors, made up 29 percent of sales, up slightly from a year ago.

The national median existing-home price dropped 5.1 percent year over year in August, to $168,300. Distressed homes, typically sold at a discount, made up 31 percent of sales in August, down from 34 percent in August 2010.

Sales rose on an annual basis in all price ranges last month with homes under $100,000 seeing the biggest boost. Homes above $1 million also did fairly well with a sales jump of 12.3 percent — higher than that of homes between $500,000 and $750,000 as well as homes between $750,000 and $1 million.

Sources: Inman News and NAR