In a year-to-year comparison, sales dropped 16.6% even as prices rose 1.9% to $407K – only the fourth month ever over $400K. Inventory increased 3.7%, however.
WASHINGTON – Existing-home sales fell again in July, according to the National Association of Realtors® (NAR) latest release. Among the four major U.S. regions NAR includes within the study, sales grew in the West but faded in the Northeast, Midwest and South.
In a year-to-year comparison however, all four regions saw year-over-year sales declines.
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – fell 2.2% compared to June to a seasonally adjusted annual rate of 4.07 million in July. Year-over-year, sales slumped 16.6% (down from 4.88 million in July 2022). “Seasonally adjusted” means NAR’s numbers can be compared month-to-month even though demand changes throughout the year.
“Two factors are driving current sales activity – inventory availability and mortgage rates,” says NAR Chief Economist Lawrence Yun. “Unfortunately, both have been unfavorable to buyers.”
The inventory of for-sale homes has grown but only marginally. Total housing inventory at the end of July was 1.11 million units, up 3.7% month-to-month but down 14.6% year-to-year (1.3 million). Unsold inventory sits at a 3.3-month supply at the current sales pace, up from 3.1 months in June and 3.2 months in July 2022.
The median existing-home price for all housing types in July was $406,700, a 1.9% increase since July 2022 ($399,000). Prices rose in the Northeast, Midwest and South, but were unchanged in the West.
“Most homeowners continue to enjoy large wealth gains from recent years with little concern about home price declines,” Yun says. “However, many renters are concerned (because) they’re facing growing affordability challenges because of high interest rates.”
Notable takeaways from July numbers
- According to the Realtors Confidence Index, properties typically remained on the market for 20 days in July, up from 18 days in June and 14 days one year earlier. Three out of four (74%) of July homes were on the market for less than a month.
- About a third (30%) of July home sales went to first-time buyers, an increase from June’s 27% and marginally higher than the 29% in July 2022.
- All-cash sales accounted for 26% of transactions in July, unchanged month-to-month but up from 24% in July 2022.
- Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in July, down from 18% in June but up from 14% one year ago.
- Distressed sales – foreclosures and short sales – were 1% of sales in July, virtually unchanged month-to-month and year-to-year.
- According to Freddie Mac, the 30-year fixed-rate mortgage averaged 7.09% as of August 17 – up from 6.96% the prior week and 5.13% one year ago.
“Retreating mortgage rates will bring more buyers and sellers to the market and get Americans moving again,” Yun says.
Single-family and condo/co-op sales: Single-family home sales slid to a seasonally adjusted annual rate of 3.65 million in July, down 1.9% from 3.72 million in June and 16.3% year-to-year. The median existing single-family home price was $412,300 in July, up 1.6% from July 2022.
Existing condominium and co-op sales recorded a seasonally adjusted annual rate of 420,000 units in July, down 4.5% from June and 19.2% from one year ago. The median existing condo price was $357,600 in July, up 4.5% from the previous year ($342,200).
Regional breakdown: Existing-home sales in the Northeast fell 5.9% month-to-month to an annual rate of 480,000 in July, and down 23.8% from July 2022. The median price in the Northeast was $467,500, up 5.5% from one year ago.
In the Midwest, existing-home sales decreased 3.0% from the prior month to an annual rate of 960,000 in July, dropping 20.0% from the previous year. The median price in the Midwest was $304,600, up 3.9% from July 2022.
Existing-home sales in the South fell 2.6% month-to-month to an annual rate of 1.86 million in July, and they fell 14.3% year-to-year. The median price in the South was $366,200, up 1.7% from July 2022.
In the West, existing-home sales increased 2.7% from the previous month to an annual rate of 770,000, though they were down 12.5% year-to-year. The median price in the West was $610,500, unchanged from July 2022.
