Home buyers can expect to pay more for a home this summer. The median existing-home price for all housing types reached an all-time high in May at $264,800, according to the latest housing report released by the National Association of REALTORS®.
Many markets continue to see a flood of buyers but not enough homes for sale, which is prompting prices to rise and also limiting the number of sales. For the second consecutive month, existing-home sales dropped, even in the midst of a typically busy selling season.
Total existing-home sales—which are completed transactions for single-family homes, townhomes, condos, and co-ops—fell 0.4 percent to a seasonally adjusted annual rate of 5.43 million in May, the National Association of REALTORS® reported Wednesday. Sales are now 3 percent lower than a year ago.
“Inventory coming onto the market during this year’s spring buying season was not even close to being enough to satisfy demand,” says Lawrence Yun, NAR’s chief economist. “That is why home prices keep outpacing incomes and listings are going under contract in less than a month—and much faster—in many parts of the country.”
Closings were down in a majority of the country last month and declined on an annual basis in every major region, Yun says. “Incredibly low supply continues to be the primary impediment to more sales, but there’s no question the combination of higher prices and mortgage rates are pinching the budgets of prospective buyers, and ultimately keeping some from reaching the market,” Yun says.
May’s Housing Stats
Here’s a closer look at some of the key indicators of the housing market from NAR’s latest housing report:
- Home prices: The median existing-home price for all housing types was $264,800 in May, an all-time high. Home prices were up 4.9 percent from a year ago.
- Inventory: Total housing inventory at the end of May rose 2.8 percent to 1.85 million existing homes available for sale. Still, the number of homes for sale is 6.1 percent lower than a year ago. Unsold inventory is at a 4.1-month supply at the current sales pace.
- Days on the market: Properties typically stayed on the market for 26 days in May, down from 27 days a year ago. Fifty-eight percent of homes sold in May were on the market for less than a month.
- First-time home buyers: This segment comprised 31 percent of sales in May, down from 33 percent a year ago.
- All-cash sales: All-cash sales accounted for 21 percent of transactions in May, down from 22 percent a year ago. Individual investors tend to make up the bulk of cash sales. They purchased 15 percent of homes in May, down from 16 percent a year ago.
- Distressed sales: Foreclosures and short sales made up 3 percent of sales in May, the lowest reading since NAR began tracking such data in 2008. Distressed sales are down from 5 percent a year ago. In May, 2 percent of sales were foreclosures and 1 percent were short sales.