The pace of existing-home sales closed out the second quarter in retreat, slowing from May to June but remaining higher than year-ago levels amid fragile homebuying demand.

Updated sales data released Thursday by the National Association of Realtors (NAR) reflected a 2.4% slowdown in closed contracts over the month, which lowered the annualized sales pace to 4.09 million units, up 2.8% from a year ago. The pace of existing-home sales had reached a five-month high in May.

“The back-and-forth in monthly home sales activity, driven by mild fluctuations in mortgage rates, shows how sensitive homebuyers are to affordability conditions,” noted Lawrence Yun, chief economist of the Realtor association, in analysis accompanying the data.

But median sale prices for existing homes, which reached an all-time high in June of $440,600, are also whisking monthly housing payments higher. This has raised the typical loan amount buyers may need to finance, which disproportionately impacts borrowers with less equity for downpayments.

Existing-home sales reflect closed contract activity, meaning the data reported by NAR on Thursday largely reflects properties that went under contract in May.

“Without consistent gains in inventory, home prices can accelerate,” added Yun. “It is critical to introduce more supply to the market to widen the opportunity for homeownership.” Realtor.com reported overall active inventory remained almost 10% below June 2019 levels last month, with new listings down 16.7%.

Loan hedging and market intelligence provider Optimal Blue reported separately that average mortgage loan amounts neared all-time highs in June at just above $399,000.

Mortgage Bankers Association data shows average loan amounts were $381,900 in March 2026, though they hovered around $400,000 or higher from the first quarter of 2021 to the first quarter of 2025.

The more than 5% decline in average loan amounts from the beginning of last year to the start of the second quarter illustrates the effect of broad home price softening that accelerated last year amid historically low purchase affordability.

But a single-family inventory shortfall has driven sharply diverging regional market conditions that will likely support even higher prices until supply imbalances are addressed, housing analysts broadly agree.

On a monthly basis, the pace of sales rose 2.1% in the Northeast while slowing 3% in the Midwest, 3.6% in the South and 1.3% in the West.

Sales were flat on an annual basis in the Northeast but posted growth of 2.1% in the Midwest, 3.8% in the South and 2.8% in the West region.

“Until buyers and sellers gain more confidence in where the market is headed, both sides are likely to stay cautious, and sales activity may stay subdued,” said Ali Wolf, chief economist at NewHomeSource, the consumer portal for Zonda, a market intelligence platform for home builders.

Wolf also noted a pullback in new-home sales. The pace of new-home sales was 11% lower than a year ago in April and 6.8% lower annually in May, the latest months for which data is available, according to government estimates.

“Today’s report reflects the uncertainty in the overall market,” Wolf said in commentary shared with Scotsman Guide. “The majority of builders say demand is slower than expected, even with incentives being more commonplace than they were a year ago.”