Existing-home sales were at a seasonally adjusted annual rate of 5.52 million in June, a decrease of 1.8% compared with about 5.62 million in May but up 0.7% compared with June 2016, according to the National Association of Realtors (NAR).
Lawrence Yun, chief economist for NAR, says the slowdown was once again due to a lack of inventory. Total housing inventory as of the end of June was about 1.96 million existing homes, a decrease of 0.5% compared with May and a decrease of 7.1% compared with June 2016.
That as about a 4.3-month supply at the current sales pace, down from 4.6 months a year ago.
Total inventory has now fallen on year-over-year basis for the past 25 consecutive months. The lack of inventory is particularly impacting first-time home buyers, who represented about 32% of sales in June, down from 33% a year earlier.
“It’s shaping up to be another year of below average sales to first-time buyers despite a healthy economy that continues to create jobs,” Yun says in a statement. “Worsening supply and affordability conditions in many markets have unfortunately put a temporary hold on many aspiring buyers’ dreams of owning a home this year.”
Yun points out that the decrease in June is not much of a surprise when one considers the slowdown in pending home sales that came during the previous three months.
“Closings were down in most of the country [in June] because interested buyers are being tripped up by supply that remains stuck at a meager level and price growth that’s straining their budget,” Yun says. “The demand for buying a home is as strong as it has been since before the Great Recession. Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines.
“The good news is that sales are still running slightly above last year’s pace despite these persistent market challenges” he adds.
The median existing-home price for all housing types in June was $263,800, up 6.5% from $247,600 in June 2016.
June’s median sales price surpasses May as the new peak and is the 64th straight month of year-over-year gains.
For more, including a breakdown of existing-home sales by region, click here.