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U.S. Home Sales Edge Up Slightly as Market Struggles to Escape Slump
August 28, 2024
Existing-home sales in July were the lowest for any July since 2010, but the month still provided a glimmer of hope in an otherwise dour period for the housing market.
Sales of previously owned homes, which account for the bulk of the housing market, rose 1.3% in July from the month prior, for a seasonally adjusted annual rate of 3.95 million, according to the National Association of Realtors (NAR). The slight increase marks the first monthly increase after a fourth-month streak of monthly declines.
On an annual basis, existing home sales were down 2.5% from a year earlier.
The combination of higher mortgage rates and high home prices has priced many prospective buyers out of the market. Mortgage rates have fallen somewhat in recent weeks, which helped boost July’s sales figures, but existing home sales have been stuck at low levels all year. The spring selling season, which is typically the busiest homebuying period of the year, saw the market in a veritable standstill.
Prices slipped from June’s record high, but only slightly. The national median existing-home price in July was $422,600, an increase of 4.2% from a year prior, according to the NAR. Home pricing data is not adjusted for inflation.
Part of the price easing was due to an increasing supply of homes on the market. Nationally, there were 1.33 million homes on the market at the end of July, according to the NAR. That is an increase of 0.8% from the month prior and a sizable increase of 19.8% from a year earlier.
Even with the increased supply, inventory is constrained. At the current sales pace, the inventory represents a 4-month supply. Typically a supply of 6 months is considered balanced between buyers and sellers. The current constraint should keep prices elevated.
