Existing home sales had fallen for six straight months before May’s numbers turned up slightly, showing a 0.8% increase, according to June’s National Association of Realtors (NAR) Home Sales Report. But the upturn was a blip, it seems, as the newest report released Wednesday sees a 2.7% decrease in June.
The report also stated there was a 0.6% decline in unsold inventory – 1.53 million units is equal to 4.7 months of supply.
Month-over-month sales declined in the Northeast, Midwest and South. They rose a bit in the West. Year-over-year, sales decreased in the Northeast and West regions, while increasing in Midwestern and Southern states.
“The record high median home price highlights how American homeowners’ wealth continues to grow—a benefit of homeownership. The average homeowner’s wealth has expanded by $140,900 over the past five years,” said NAR Chief Economist Lawrence Yun.
Yun attributes this to multiple years of undersupply driving record-high home prices.
Home construction continues to lag population growth, which he said is holding back first-time home buyers from entering the market. “More supply is needed to increase the share of first-time homebuyers in the coming years even though some markets appear to have a temporary oversupply at the moment.”
The report also has Yun attributing the cause of the high mortgage rates to home sales remaining stuck at cyclical lows. If the average mortgage rates were to decline to 6%, the NAR scenario analysis shows an additional 160,000 renters would become first-time homeowners, along with elevated sales activity from existing homeowners.
“Expanding participation in the housing market will increase the mobility of the workforce and drive economic growth,” Yun stated. “If mortgage rates decrease in the second half of this year, expect home sales to increase across the country due to strong income growth, healthy inventory, and a record-high number of jobs.”
The report also showed median home prices for single-family residences nationally were $441,500 – a 2% increase from June 2024. That is a record high for the month of June, and the 24th consecutive month of price increases year-over-year.
Regionally, median prices were up year-over-year in the Northeast ($543,300, up 4.2%); the Midwest ($337,600, up 3.4%); the South ($374,500, up 0.3%); and in the West ($636,100, up 1%).
Only the West showed monthly gains in sales, with a 1.4% increase month-over-month, with an annual rate of 710,000, down 4.1% year-over-year.
