Existing home sales fall again in June as prices hit record high

Sales of existing homes fell for the fifth consecutive month in June, according to the National Association of Realtors. Three of the four major US regions saw lower month-over-month sales and one region was flat. Year-over-year sales fell in all four regions.

Total existing home sales, completed deals that include single-family homes, townhouses, condominiums and co-ops, fell 5.4% from May to a seasonally adjusted annual rate of 5.12 million in June . Year-on-year, sales fell 14.2% (5.97 million in June 2021).

“The decline in housing affordability continues to weigh on potential buyers,” said NAR chief economist Lawrence Yun. “Mortgage rates and house prices have risen too steeply in a short time.”

The total housing inventory recorded at the end of June was 1.26 million units, an increase of 9.6% compared to May and a rise of 2.4% compared to the previous year (1.23 million). Unsold inventory is at a three-month supply at the current selling rate, down from 2.6 months in May and 2.5 months in June 2021.

The median existing home price for all housing types in June was $416,000, up 13.4% from June 2021 ($366,900), as prices rose in all regions. That’s 124 straight months of year-over-year increases, the longest streak on record.

Properties generally stayed on the market for 14 days in June, compared to 16 days in May and 17 days in June 2021. The 14 days on the market is the fewest since NAR started tracking it in May 2011. Four- Twenty-eight percent of homes sold in June 2022 had been on the market for less than a month.

“Finally, there are more houses on the market,” Yun added. “Interestingly, the record pace of days on the market implies a blurrier picture for house prices. Homes that are priced right sell very quickly, but homes that are overpriced deter potential buyers. »

First-time buyers were responsible for 30% of sales in June, compared to 27% in May and 31% in June 2021. -time buyers were 34%.

Cash sales accounted for 25% of transactions in June, the same share as in May and up from 23% in June 2021.

“Existing home sales for June are mostly bad news, but with a silver lining,” said Robert Frick, business economist at Navy Federal Credit Union. “Higher prices and higher mortgage rates continue to frustrate potential buyers, but this is leading to increased inventory, which should eventually moderate price increases. We are already seeing a slight slowdown in real estate inflation, with some sellers reducing their prices.

Individual investors or buyers of second homes, which make up many cash sales, bought 16% of homes in June, unchanged from May and a slight increase from 14% in June 2021. Troubled sales – foreclosures and short selling – accounted for less than 1% of sales in June, essentially unchanged from May 2022 and June 2021.

According to Freddie Mac, the average commitment rate for a conventional 30-year fixed-rate mortgage was 5.52% in June, down from 5.23% in May. The average engagement rate over the whole of 2021 was 2.96%.

“If consumer price inflation continues to rise, then mortgage rates will rise,” Yun said. “Rates will only stabilize when signs of peak inflation appear. If inflation is contained, mortgage rates could even drop somewhat.

Realtor.com’s June Market Trends Report shows the strongest year-over-year median list price growth occurred in Miami (+40.1%), Orlando (+30, 6%) and Nashville (+30.6%). Austin had the largest increase in the share of homes that were priced down from a year ago (+24.7 percentage points), followed by Phoenix (+22.2 percentage points) and Las Vegas (+20.1 percentage points).

Single-family and condo/co-op sales

Sales of single-family homes fell at a seasonally adjusted annual rate of 4.57 million in June, down 4.8% from 4.80 million in May and down 12.8% from one year ago. The median price of existing single-family homes was $423,300 in June, up 13.3% from June 2021.

Sales of existing condominiums and co-ops were recorded at a seasonally adjusted annual rate of 550,000 units in June, down 9.8% from May and 24.7% from a year ago. The median price of existing condos was $354,900 in June, an annual increase of 11.5%.

“Owning a home can pave the way to financial freedom and lead to long-term wealth gains that families can pass on to future generations,” NAR President Leslie Rouda Smith, a Plano real estate agent, said at Texas, and an associate broker at Dave Perry. -Miller Real Estate in Dallas. “We will remain steadfast in our efforts to protect homeowners’ rights, and our members will continue to provide valuable expertise to consumers throughout the home buying process.”

Regional distribution

At an annual rate of 670,000 in June, sales of existing homes in the North East were unchanged from May and down 11.8% from June 2021. The median price in the North East was of $453,300, a 10.1% jump from a year ago.

Sales of existing homes in the Midwest fell 1.6% from the previous month to an annual rate of 1,230,000 in June, down 9.6% from June 2021. The median price in the Midwest was $306,900, an increase of 10.2% over the previous year.

Sales of existing homes in the South fell 6.2% in June to an annual rate of 2,260,000, down 14.1% from a year earlier. The median price in the South was $374,900, a rebound of 16.8% from a year ago. For the tenth consecutive month, the South recorded the highest pace of price appreciation compared to the other three regions.

Existing home sales in the West fell 11.1% from the previous month to an annual rate of 960,000 in June, down 21.3% from the same period last year. The median price in the West was $624,000, an increase of 9.6% from June 2021.

“There are several reasons to be optimistic about the future,” said Neda Navab, President of National Brokerage Operations at Compass. years of home buying and ever-increasing rents, remain firmly in place.

She added: “Buyers in the market today can find more room to negotiate than they have had in years, and a slowly growing share of first-time buyers proves that they are certainly aware that locking a house today at a long-term price is a great hedge against inflation and rising rents. For sellers, price growth remains robust and typical time-to-market has remained incredibly low, a sign that if their homes are reasonably priced, well-located and in good condition, they can still expect a lot. attention from buyers.