After gains in May, existing home sales, released by the National Association of Realtors (NAR), fell more than expected in June.
Total existing home sales, including single-family homes, townhomes, condominiums and co-ops, dropped 1.7% to a seasonally adjusted annual rate of 5.27 million in June. On a year-over-year basis, sales were 2.2% lower than a year ago, marking the sixteenth straight month of declines on an annualized basis.
The first-time buyer share rose to 35% in June from 32% last month and 31% a year ago. The June inventory increased to 1.93 million units from 1.91 million units in May, but unchanged from the level of one year ago. At the current sales rate, the June unsold inventory represents a 4.4-month supply, up from a 4.3-month supply both last month and a year ago.
Homes stayed on the market for an average of 27 days in June, up from 26 days both last month and a year ago. In June, 56% of homes sold were on the market for less than a month.
The June all-cash sales shared 16% of transactions, down from 19% last month and 22% a year ago.
The June median sales price of all existing homes reached a record high of $285,700, up 4.3% from a year ago, representing the 88th consecutive month of year-over-year increases. The median existing condominium/co-op price of $260,100 in June was up 2.8% from a year ago.
Regionally, existing home sales were mixed in June. Sales in the Northeast and Midwest grew 1.5% and 1.6% from last month, while sales in the South and West declined 3.4% and 3.5%. On a year-over-year basis, sales fell in all regions, ranging from 0.4% in the South to 5.2% in the West.
Given lower mortgage rates and continued wage growth, insufficient affordable housing supply and homebuyers’ lack of confidence help to explain the lower sales. As home prices are driven up by a mismatch between housing demand and supply, NAR suggests more inventory is needed. Meanwhile, builder confidence rose one point to 65 in July, but builders continued to grapple with labor shortages and costly building materials that are hurting affordability and depressing supply.