At Inman Connect Las Vegas, July 30-Aug. 1 2024, the noise and misinformation will be banished, all your big questions will be answered, and new business opportunities will be revealed. Join us.
Existing-home sales shouldered a modest drop in May while the median sale price climbed to a new all-time high, according to data released Friday by the National Association of Realtors.
Sales of existing homes slid 0.7 percent between April and May to a seasonally adjusted annual rate of 4.11 million, the third-consecutive month of decreasing sales, data shows. Transactions also fell 2.8 percent on an annual basis.
TAKE THE INMAN INTEL INDEX SURVEY FOR JUNE
“Eventually, more inventory will help boost home sales and tame home price gains in the upcoming months,” NAR Chief Economist Lawrence Yun said in a statement. “Increased housing supply spells good news for consumers who want to see more properties before making purchasing decisions.”
The median existing-home sale price grew 5.7 percent from May 2023 to a whopping $419,300 — the highest price recorded by NAR since it began tracking the metric in 1999 — following 11-straight months of price gains. The record-smashing price increase threatens to create further barriers to entry for aspiring home buyers already dealing with elevated mortgage rates, Yun suggested.
“Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” Yun said. “The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning.”
The 30-year fixed mortgage rate averaged 6.87 percent as of June 20, according to Freddie Mac, a decrease from the 6.95 percent average recorded the prior week but up from 6.67 percent a year earlier.
While mortgage rates dipped modestly in May, sales dipped with them, illustrating how much of an issue affordability is to buyers according to Zillow Senior Economist Orphe Divounguy.
“The decrease in sales is a stark reminder that affordability is still a challenge,” Divounguy said, “even as month-to-month improvements in inventory and interest rates emerge.”
