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First Cut: Dip in June sales of existing homes after rush to buy in May

Sales of existing homes in June declined 1.7% to 5.27 million units SAAR after 2.9% increase to 5.36 million units in June when homebuyers were in a rush to lock in lower mortgage interest rates. Sales were down 2.2% compared to a year ago when home resales were at a near-term peak.

The decrease is small and after an upward revision to the prior month (previously 5.34 million in June). The level of sales in June are about on track for 2019 to-date and shouldn’t be particularly disappointing even if a little below the median market forecast.

Resales were up in two regions and down in two others. The Northeast (up 1.5%) and Midwest (up 1.6%) saw similar gains, while the South (down 3.4%) and West (down 3.5%) were about matched in the pace of decreases.

The months’ supply of homes for sale inched up to 4.4 in June after 4.3 in May and hints that home sellers are bringing more inventory onto the market while lower mortgage interest rates are motivating potential home buyers. Supplies remain comparatively limited.

The median price of an existing home was up 2.7% in June to $285,700 from the prior month, and rose 4.3% compared to a year-ago. The average price of resale was up 2.2% in June from May, and up 2.2% compared to last year. Home prices have regained some upward momentum, although increases are still modest compared to the past two years.

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