LOS ANGELES — Sales of previously occupied U.S. homes fell in June to their slowest pace since January, as near-historic low sales and rising mortgage rates put more homebuyers on hold. outside. National average selling prices fell year-over-year for the fifth straight month, although stiff competition has caused about a third of homes to sell for more than list price.
Existing home sales fell 3.3% last month from May to a seasonally adjusted annualized level of 4.16 million, the National Association of Realtors said on Thursday. The number was slightly below what economists expected, according to FactSet, and marked the slowest pace of sales since January.
Sales were down 18.9% from last June. That makes it 11 straight months of annual sales down 20% or more. All told, sales fell 23% in the first half of this year.
The national average selling price fell 0.9 percent from last June to $410,200. That was the smallest annual drop since March. Although down from a year ago, the average selling price was up month-over-month, reaching the second-highest on record since January 1999.
“Perhaps house prices are starting to rise or at least certainly all downward pressure is ending,” said Lawrence Yun, chief economist at NAR.
The latest housing market figures are further proof that even as prices fall back year after year after rising for more than a decade, many home hunters are still held back by the steady flow of homes for sale. at low level.
NAR said about 1.08 million homes were still on the market at the end of June, down 13.6 percent from a year earlier. That equates to a 3.1-month supply at current sales rates. In a more balanced market between buyers and sellers, there would be a 5 to 6 month supply.
A shortage of homes for sale has made the market competitive, fueling bidding wars in many places, especially for the most affordable homes. About a third of homes bought last month sold for more than list price, and 76% of homes sold in June were on the market for less than a month.
“This is a tough market to be a buyer,” said Yun.
The combination of high borrowing costs and stiff competition for the most affordable homes on the market is keeping many first-time buyers out of reach. They accounted for 27% of home sales last month, down from 28% in May and 30% in June last year, NAR said. In a normal housing market, that would be 40%.
The U.S. housing market has yet to recover from the recession that began more than a year ago, when average interest rates on 30-year mortgages began to rise from the extreme lows when the Federal Reserve began to rise. short-term interest rates. in its fight against inflation.
Global demand for US Treasuries, which lenders use as a guide to pricing loans, investors’ expectations for future inflation, and what the Fed does with interest rates affect home loan interest rates.
The average interest rate on a 30-year home loan is still more than double what it was two years ago, when ultra-low interest rates spurred a wave of home sales and refinancing. Average weekly interest rates on 30-year mortgages ranged from 6.67% to 6.79% in June, according to mortgage buyer Freddie Mac.
Higher mortgage rates can add hundreds of dollars a month in costs for homebuyers in addition to already high home prices. They also discourage homeowners who locked in a low interest rate two years ago to sell their homes — one reason for the low supply of homes for sale even during the traditionally busy spring home buying season.