According to the data from the National Association of Realtors (NAR) in the United States, after seasonal adjustments, the sales of existing homes in June decreased by 2.7% compared to May, reaching 3.93 million units. Analysts had previously predicted a drop of only 0.7%, with sales remaining stable compared to June 2024.
The report is based on transaction volume, so most of the buying and selling contracts were likely signed in April and May. According to data from Mortgage News Daily, the average interest rate for 30-year fixed mortgage loans had repeatedly surpassed 7% during that time and never dropped below 6.8%.
NAR’s Chief Economist Lawrence Yun stated, “High mortgage rates have kept home sales lingering at cyclical lows. If average mortgage rates were to drop to 6%, our scenario analysis shows an additional 160,000 renters would become first-time buyers, and sales activities of existing homeowners would also significantly increase.”
In recent months, mortgage rates have seen little significant change, currently averaging 6.77%, remaining high, reflecting market concerns about the overall economy.
Currently, housing supply continues to increase, with 1.53 million homes on the market as of the end of June, a 15.9% increase from the previous year. At the current sales pace, this represents a 4.7-month inventory. Typically, a six-month inventory is considered a balanced market between buyers and sellers, indicating the market still tilts towards supply outnumbering demand.
The median sales price for homes sold in June was $435,300, a 2% annual increase, setting a new record for the month of June and marking the 24th consecutive month of year-over-year price increases.
Lawrence Yun also mentioned, “Years of insufficient supply have led to repeated record highs in home prices. The slow pace of new home construction compared to population growth has made it difficult for many first-time homebuyers to enter the market.” He noted that over the past five years, the average homeowner’s wealth has increased by $140,900.
In terms of sales performance, the high-end market continues to outperform the mid-to-low-end market. Homes priced below $100,000 saw a 5% annual sales decrease, while homes priced between $100,000 to $250,000 experienced a 5% sales increase, and homes priced over $1 million had a 14% sales increase.
The report indicates that homes are staying on the market longer, averaging 27 days, higher than the 22 days in June of the previous year. However, sales of higher-priced residences continue to outpace those below $500,000.
First-time homebuyers accounted for 30% of total sales, below the historical average of 40%. The proportion of all-cash transactions remains high, representing 29% of total sales, compared to around 20% before the pandemic.
On average, listed homes received 2.4 offers, slightly lower than the 2.5 offers from the previous month and the 2.9 offers from the same period last year.