After 11 consecutive months of price increases, the median sales price of an existing U.S. home has surged to $419,300, the highest level since NAR began tracking the metric.
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Data released Friday by the National Association of Realtors showed existing home sales fell slightly in May, while the median sales price climbed to a record high.
Data showed that sales of existing homes fell 0.7% from April to May to a seasonally adjusted annual rate of 4.11 million units, marking the third consecutive month of sales declines. Transaction volume also fell 2.8% from the same period last year.
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“Ultimately, more inventory will help boost home sales in the coming months and curb home price increases,” NAR Chief Economist Lawrence Yun said in a statement. “The increase in housing supply will be a critical factor for those looking to make a This is good news for consumers who want to see more properties before making a purchase decision.”
Following 11 consecutive months of price increases, the median existing home sales price rose 5.7% from May 2023 to a staggering $419,300, the highest price recorded since NAR began tracking the metric in 1999. Yin said record price increases could create additional barriers to entry for aspiring homebuyers already facing rising mortgage rates.
“House prices have hit record highs, creating a wider gap between those who own property and those looking to buy their first home,” Yun said. “Today, the mortgage payment for a typical home is more than double what it was for a home purchased before 2020. Nonetheless, first-time buyers in the market understand the long-term benefits of homeownership.”
As of June 20, 30-year fixed mortgage rates averaged 6.87%, down from the 6.95% average the previous week but up from 6.67% a year ago, according to Freddie Mac.
Zillow senior economist Orphe Divounguy said that while mortgage rates fell slightly in May, sales also fell, which shows how important affordability is to buyers.
“The decline in sales is a clear reminder that while inventory and rates are improving month over month, affordability remains a challenge,” Diwanji said.
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