Existing-home sales increased slightly in May, just enough to put a positive spin on the otherwise difficult market.
Sales rose by 0.2%, barely moving, to a seasonally adjusted annual rate of 4.30 million from 4.28 million the month prior, according to the latest data from the National Association of Realtors.
Year-over-year, sales are down 20.4%.
The South and West saw improvement month-over-month, but the Northeast and Midwest fared poorly.
“Mortgage rates heavily influence the direction of home sales. Relatively steady rates have led to several consecutive months of consistent home sales,” said NAR Chief Economist Lawrence Yun.
The median price for an existing dropped, down 3.1% to $396,100, NAR found. This is just the fourth YOY decline in years. February’s dip broke the longest streak on record, 131 consecutive months of price gains.
May’s inventory of unsold homes rose by 3.8% from May to 1.08 million.
This is a 3-month supply at the current sales pace, an improvement.
The typical home stayed on the market for 18 days, down from 22 in March, while 74% of homes sold were on the market for less than a month.
Sales of new homes have benefitted from the lack of existing inventory. New home sales were down slightly last month but remain elevated from last time, up nearly 12% YOY. Yun noted that new homes are flying off the shelves, and demand is keeping prices high.
Builder confidence increased in June for the sixth consecutive month.
“Builders are feeling cautiously optimistic about market conditions given low levels of existing home inventory and ongoing gradual improvements for supply chains,” said NAHB Chairman Alicia Huey. “However, access for builder and developer loans has become more difficult to obtain over the last year, which will ultimately result in lower lot supplies as the industry tries to expand off cycle lows.”
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