A lack of homes for sale, high home prices, and elevated mortgage rates combined to send home sales plunging in June, data from the National Association of Realtors showed Thursday.
The pace of home sales in June fell by 18.9 percent compared with a year ago to a seasonally adjusted annual rate of 4.16 million, the National Association of Realtors (NAR) said. Sales were down 3.3 percent compared with the prior month.
The total number of homes for sale was down 13.8 percent compared with a year ago to 1.08 million. Compared with a month early, the number of homes for sale was flat.
“There are simply not enough homes for sale,” NAR chief economist Lawrence Yun said. “The market can easily absorb a doubling of inventory.”
Economists had forecast home sales of 4.23 million after May’s 4.3 million annualized pace.
This was the slowest pace for home sales since January and the slowest June since 2009.
The median price paid for an existing home in June was $410,200, just behind the all-time high hit in June of last year at $413,800. This is the second-highest price that the NAR has recorded since it began tracking the data in 1999.
Single-family home sales fell to a seasonally adjusted annual rate of 3.72 million in June, down 3.4 percent from 3.85 million in May and 18.8 percent from a year ago. The median existing single-family home price was $416,000 in June, down 1.2 percent from June 2022.
Existing condominium and co-op sales fell 2.2 percent to adjusted annual rate of 440,000 units in June. Compared with a year ago, sales are down 20 percent. 2 The median existing condo price was $361,600 in June, up 1.9 percent from the previous year.
“Home sales fell but home prices have held firm in most parts of the country,” Yun said. “The national median home price in June was slightly less than the record high of nearly $414,000 in June of last year. Limited supply is still leading to multiple-offer situations, with one-third of homes getting sold above the list price in the latest month.”
Many current homeowners have mortgages with interest rates fixed far below what is currently available from home lenders. Just 10 percent of homeowners have mortgages with rates above six percent. The average rate on a 30 year fixed mortgage currently available from lenders is 6.96 percent, according to Freddie Mac. As a result, many homeowners are effectively locked in to their current home, unable to trade up or down without agreeing to a much higher rate.
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