According to data from the National Association of Realtors, the sales of second-hand houses in June decreased by 5.4% compared to May, and the annualized sales volume after seasonal adjustment was 3.89 million units. The sales volume also decreased by 5.4% compared to June last year. This is the slowest sales rate since December. #Outlook for the market in the second half of 2024#
These are sales that have been completed, primarily based on contracts signed in April and May, when the average interest rate for 30-year fixed-rate mortgages exceeded 7%. Since then, interest rates have fallen slightly and are currently in the high range of 6%.
"We are seeing a slow transition in the real estate market from a seller's market to a buyer's market," said Lawrence Yun, chief economist of the National Association of Realtors. "Houses are staying on the market longer, and sellers are receiving fewer quotes. More buyers are insisting on home inspections and assessments, and inventory is rising significantly nationwide."
Inventory increased by 23.4% from the same period last year, reaching 1.32 million units at the end of June, although it is still at historically low levels, the supply is 4.1 months. A six-month supply is considered a balance between buyers and sellers.
Benefiting from the longer duration of homes on the market, these inventory levels are the highest since May 2020.
However, even this new supply has not helped ease prices. The median price of existing homes sold in June was $426,900, a 4.1% year-over-year increase and the second consecutive month of record highs. Part of the reason is that the high-end market is stronger.
Homes with sale prices over $1 million are the only price category with growth compared to last year, while homes with sale prices of $0.25 million and below have the largest decline in sales volume.
The supply of low-end homes is the weakest, but now there is a new surge. Although national sales prices are high, newly listed prices are lower.
"The median listing price is squeezed down by the influx of lower-priced homes. In fact, the number of homes for sale in the price range of $0.2 million to $0.35 million has increased by 50% compared to last year," said Danielle Hale, chief economist at Realtor.com.
High-end buyers tend to use more cash, with 28% of sales being all-cash transactions, up from 26% a year ago. Investors have slightly retreated, accounting for 16% of sales volume, down from 18% a year ago.
"Assuming inventory continues to increase, two things will happen. Either home sales will increase, or if prices don't rise, prices will fall," Yun added.