NAR: August Existing-Home Sales Drop 0.7%

WASHINGTON – U.S. existing-home sales moved lower in August, according to the National Association of Realtors® (NAR). Among the four major U.S. regions NAR tracks as part of the overall survey, sales improved in the Midwest, were unchanged in the Northeast, and slipped in the South and West. All four regions recorded year-over-year sales declines.

Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – slid 0.7% month-to-month to a seasonally adjusted annual rate of 4.04 million in August.

Year-over-year, sales fell 15.3% (down from 4.77 million in August 2022).

“Home sales have been stable for several months, neither rising nor falling in any meaningful way,” says NAR Chief Economist Lawrence Yun. “Mortgage rate changes will have a big impact over the short run, while job gains will have a steady, positive impact over the long run. The South had a lighter decline in sales from a year ago due to greater regional job growth since coming out of the pandemic lockdown.”

Total housing inventory at the end of August was 1.1 million units, a 0.9% decline month-to-month and 14.1% year-to-year (1.28 million). Unsold inventory sits at a 3.3-month supply at the current sales pace, which is identical to July numbers and up from 3.2 months in August 2022.

Even as sales decline, however, housing prices continue to rise. The median existing-home price for all housing types in August was $407,100, an increase of 3.9% from August 2022 ($391,700). All four U.S. regions posted price increases.

“Home prices continue to march higher despite lower home sales,” Yun said. “Supply needs to essentially double to moderate home price gains.”

Other August home sale takeaways

• First-time buyers made 29% of August sales, down from 30% in July and identical to August 2022.
• 27% of August transactions were all-cash sales, up from 26% in July and 24% in August 2022.
• Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in August – the same share month-to-month as well as year-to-year.
• Distressed sales – foreclosures and short sales – represented 1% of sales in August, unchanged from last month and the previous year.

Mortgage rates: According to Freddie Mac, the 30-year fixed-rate mortgage averaged 7.18% as of September 14, up from 7.12% the prior week and 6.02% one year earlier.

Single-family and condo/co-op sales: Single-family home sales waned to a seasonally adjusted annual rate of 3.60 million in August, down 1.4% from 3.65 million in July and 15.3% from the previous year. The median existing single-family home price was $413,500 in August, up 3.7% from August 2022.

Existing condominium and co-op sales recorded a seasonally adjusted annual rate of 440,000 units in August, up 4.8% month-to-month but down 15.4% year-to-year. The median existing condo price was $354,600 in August, up 6.2% from the prior year ($333,900).

Regional breakdown: At an annual rate of 480,000 in August, existing-home sales in the Northeast were unchanged from July but down 22.6% year-to-year. The median price in the Northeast was $465,700, up 5.8% from one year ago.

In the Midwest, existing-home sales increased 1.0% from the previous month to an annual rate of 970,000 in August, down 16.4% from the prior year. The median price in the Midwest was $305,300, up 6.8% year-to-year.

Existing-home sales in the South fell 1.1% from July to an annual rate of 1.84 million in August, a yearly decrease of 12.4%. The median price in the South was $366,100, up 3.2% from August 2022.

In the West, existing-home sales dropped 2.6% month-to-month to an annual rate of 750,000 in August, down 15.7% from the prior year. The median price in the West was $609,300, up 1.0% from August 2022.

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