Sales of existing homes in the United States fell more than expected in June and the average price again hit a record, but improved supply and lower mortgage rates offer hope that activity could pick up in the coming months.
Home sales fell 5.4 percent last month to a seasonally adjusted annual rate of 3.89 million units, the lowest level since December, the National Association of Realtors (NAR) reported Tuesday.
Economists surveyed by Reuters were expecting a decline to a rate of 4 million units.
Home resales, which account for a large portion of U.S. home sales, fell 5.4 percent year over year in June. The median existing home price jumped 4.1 percent from a year earlier to a record high of $426,900, the second straight month it hit a record high. Home prices rose in all four regions.
Home resales are counted at the closing of a contract. June sales likely reflected contracts signed in the previous two months, when the average rate on the popular 30-year fixed-rate mortgage was above 7%.
The average rate on 30-year fixed-rate mortgages fell last week to a four-month low of 6.77%, down from 6.89% and matching the average for the same period in 2023, according to data from mortgage finance agency Freddie Mac.
It has eased from a six-month high of 7.22 percent hit in May amid hopes the Federal Reserve will deliver a long-awaited interest rate cut in September.
“We’re seeing a slow shift from a seller’s market to a buyer’s market,” said Lawrence Yun, NAR’s chief economist. “Homes are sitting on the market a little longer, and sellers are getting fewer offers.”
Sales fell 5.9 percent in the densely populated South, 8 percent in the Midwest, which is considered the most affordable region, and 2.1 percent in the Northeast and 2.6 percent in the West.
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