The National Association of Realtors (NAR) said existing home sales declined for the third straight month in June.
Total existing-home sales — which are completed transactions including single-family homes, townhomes, condominiums and co-ops — fell 0.6% to a seasonally adjusted annual rate of 5.38 million in June. That’s down from a downwardly revised 5.41 million in May.
“There continues to be a mismatch since the spring between the growing level of homebuyer demand in most of the country in relation to the actual pace of home sales, which are declining,” Lawrence Yun, chief economist for NAR, said. “The root cause is without a doubt the severe housing shortage that is not releasing its grip on the nation’s housing market.”
With last month’s decline, sales are now 2.2% below a year ago.
“What is for sale in most areas is going under contract very fast and in many cases, has multiple offers,” Mr. Yun added. “This dynamic is keeping home price growth elevated, pricing out would-be buyers and ultimately slowing sales.”
The consensus forecast called for a gain to 5.44 million, and a range of 5.35 million to 5.52 million.
Total housing inventory at the end of the month was higher by 4.3% to 1.95 million existing homes available for sale. That’s now 0.5% higher than a year ago (1.94 million) – the first year-over-year increase since June 2015. Unsold inventory is at a 4.3-month supply at the current sales pace (4.2 months a year ago).
Properties typically stayed on the market for 26 days in June, unchanged from the last 3 months and down from 28 days a year ago. Fifty-eight percent (58%) of homes sold in June were on the market for less than a month.
“It’s important to note that despite the modest year-over-year rise in inventory, the current level is far from what’s needed to satisfy demand levels,” Mr. Yun continued. “Furthermore, it remains to be seen if this modest increase will stick, given the fact that the robust economy is bringing more interested buyers into the market, and new home construction is failing to keep up.”
The median existing-home price for all housing types in June was $276,900, surpassing last month as the new all-time high and up 5.2% from June 2017 ($263,300). The month of June was the 76th straight month of year-over-year price increases.
Regionally, declines in the South and West exceeded sales gains in the Northeast and Midwest.
the Northeast jumped 5.9 percent to an annual rate of 720,000, but are still 4.0 percent below a year ago. The median price in the Northeast was $305,900, which is up 3.3 percent from June 2017.
In the Midwest, existing home sales ticked up 0.8% to an annual rate of 1.27 million in June, but are 3.1% below a year ago. The median price in the Midwest was $218,800, a gain of 3.5% from a year ago.
In the South, existing home sales declined by 2.2% to an annual rate of 2.25 million in June, but still remain 0.4% above levels posted a year ago. The median price in the South was $237,500, a 2.7% gain from a year ago.
In the West, existing home sales declined 2.6% to an annual rate of 1.14 million in June, and are now 5.0% below a year ago. The median price in the West was $417,400, up 10.2% from June 2017.