U.S. home sales fell again in July as real estate downturn worsens – GV Wire
Sales of previously occupied U.S. homes slowed for the sixth consecutive month in July, deepening the housing market’s slide under the weight of sharply rising mortgage rates, soaring inflation and a slower but still solid rise house prices.
The National Association of Realtors said Thursday that sales of existing homes fell 5.9% last month from June to a seasonally adjusted annual rate of 4.81 million. That’s less than economists expected, according to FactSet.
Sales fell 20.2% from July last year. Sales have now fallen at the slowest rate since May 2020, near the start of the pandemic.
The last time there was a six-month losing streak for home sales was between August 2013 and January 2014.
The slowdown in sales was most pronounced in the western part of the country, home to some of the country’s most expensive housing markets. Sales in the region fell 30% last month from a year ago, NAR said.
Even though the housing market is running out of steam, house prices have continued to rise sharply. The national median home price jumped 10.8% in July from a year earlier to $403,800. That’s a slower rate of growth than at the start of the year, when prices were climbing about 20% annually.
July’s sales report is belated evidence that the housing market, a key driver of economic growth, is slowing from its blistering pace of recent years as buyers grapple with mortgage rates significantly higher than one year ago.
Average weekly interest rates for a 30-year benchmark home loan have fallen since hitting 5.81% in June. The rate fell this week to 5.13%, according to mortgage buyer Freddie Mac. That’s well above what it was a year ago, when it averaged 2.86.
Home hunters had a wider choice of properties in July, with the number of properties for sale up 4.8% from June to 1.31 million homes. This was unchanged from July of last year.
Still, on average, homes sold in just 14 days after hitting the market last month, matching a record pace from June. Before the pandemic, homes typically sold more than 30 days after they went on sale.
At the current rate of sales, the level of properties for sale stands at 3.3 months supply, the NAR said. This represents an increase from 2.9 months in June and 2.6 months in July 2021. This is still below the 5-6 month supply which reflects a more balanced market between buyers and sellers.