WASHINGTON — US home prices continued to fall in June compared to a year ago, but that may not be much comfort to home buyers. Even after falling, June’s median price hit the second-highest monthly median price on record going back to 1999, according to a National Association of Realtors report released Thursday.
The median existing home price was $410,200 last month, just 0.9% less than the all-time high from one year ago of $413,800.
Inventory of homes on the market remains historically low, as current homeowners are refusing to sell and hunkering down with their ultra-low mortgage rates that might be half or less of current rates.
“There are simply not enough homes for sale,” said Lawrence Yun, NAR chief economist. “The market can easily absorb a doubling of inventory.”
Sales of existing homes — which include single-family homes, townhomes, condominiums and co-ops — dropped below expectations and were down 3.3% from May to June. Annually, sales were down 18.9% from a year ago, and the seasonally adjusted annualized sales pace dropped from 5.13 million units a year ago to 4.16 million in June.
Mortgage rates remain volatile — so far this year, average rates have ranged from 6.09% to 6.96%. While rates were fairly steady in June, they were climbing in May when some of the home sales that closed in June would have gone under contract.
“The first half of the year was a downer for sure with sales lower by 23%,” said Yun. “Fewer Americans were on the move despite the usual life-changing circumstances. The pent-up demand will surely be realized soon, especially if mortgage rates and inventory move favorably.”
Supply of homes stuck
A low supply of homes to buy, especially at affordable prices in popular places, is keeping sales low and prices high.
Total housing inventory at the end of June was 1.08 million units, which is identical to May but down 13.6% from one year ago, according to the NAR. Prior to the pandemic, there were nearly twice as many homes on the market, Yun said.
Unsold inventory sits at a 3.1-month supply at the current sales pace, up from 3 months in May and 2.9 months in June 2022.
