A combination of factors continue to impact affordability of homes in the US and sales are suffering.
With prices rising due to low inventory, cost of materials for new homes and renovations, and increasing mortgage rates, affordability is a key barrier to first-time buyers and those wishing to trade up.
Existing home sales in July slipped 0.7% to a seasonally adjusted annual rate of 5.34 million, from 5.38m in June. It was the fourth consecutive month of decline.
National Association of Realtors chief economist Lawrence Yun says price rises have weakened demand.
“Led by a notable decrease in closings in the Northeast, existing home sales trailed off again last month, sliding to their slowest pace since February 2016 at 5.21 million,” he said. “Too many would-be buyers are either being priced out, or are deciding to postpone their search until more homes in their price range come onto the market.”
The median existing-home price for all housing types in July was $269,600, up 4.5% from July 2017 ($258,100). July’s price increase marks the 77th straight month of year-over-year gains.
Inventory declined by 0.5% to 1.92 million existing homes, 4.3 months of supply.
More market update: