The National Association of Realtors says that sales of existing homes fell in May.
In May, sales were lower. The sales were revised slightly lower.
The reading was the weakest since the beginning of the Pandemic. It is the lowest it has been in over a year.
The contracts signed in March and April are represented by this reading. The average rate on the 30-year fixed mortgage went from 4% to 5.5%. According to Mortgage News Daily, it is close to 6 percent. Affordability has been given a boost by rising rates, rapid home price appreciation and continued low supply.
Lawrence Yun is the chief economist at the National Association of Real Estate. Higher mortgage rates are not reflected in the data.
At the end of May, there were 1.16 million homes for sale, an increase of 12.6% month-to-month but a decrease of 4.1% from the previous May. There is a 2.6 month supply at the current sales pace.
Home prices went up due to low supply. In May, the median price of a home sold was $400,000, an increase of 14.8% from the previous year. Since the late 1980's, the highest price has been recorded.
The lower end of the market has less supply than the higher end. The sales of homes priced between $100,000 and $250,000 went down. The price range of homes was up 26%. The sales of homes above $1 million increased 22%.
There are homes for sale. Houses stayed on the market for an average of 16 days. 25% of all sales were all-cash The number of investors decreased slightly from April and a year ago.
The number of first-time buyers fell from a year ago. Rents are rising as well, so affordability is hitting them harder.
Danielle Hale wrote that higher short-term rates from the Fed are helping to drive a much needed housing reset. The challenge of navigating the housing market for both sellers and buyers is getting more difficult as expectations and conditions are changing rapidly.
This year's home sales are projected to be less than last year.
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