The National Association of Realtors (NAR) reports that the seasonally adjusted annual rate of existing home sales in August fell by 1.7% to a seasonally adjusted annual rate of 5.35 million from a total of 5.44 million in July.
The consensus estimate called for sales to reach 5.48 million, according to a survey of economists polled by Bloomberg. Total sales in 2016 came in at 5.45 million to surpass 2015’s total of 5.25 million as the most sales since 2006, when 6.48 million homes were sold.
The NAR’s chief economist, Lawrence Yun, said:
Steady employment gains, slowly rising incomes and lower mortgage rates generated sustained buyer interest all summer long, but unfortunately, not more home sales. What’s ailing the housing market and continues to weigh on overall sales is the inadequate levels of available inventory and the upward pressure it’s putting on prices in several parts of the country. Sales have been unable to break out because there are simply not enough homes for sale.
Housing inventory decreased by 2.1% in August to 1.88 million homes, equal to a supply of 4.2 months, flat with July, and has fallen year over year for 27 consecutive months. Inventory is down 6.5% year over year from 2.01 million in August 2016.
According to the NAR, the national median existing home price for all housing types in August was $253,500, up 5.6% compared with August 2016, the 66th consecutive month of rising home prices. In July the national median price was $258,300.
The percentage of first-time buyers fell from 33% in July to 31%, and it was flat compared to August 2016. For all of 2016, first-time buyers accounted for 35% of sales.
Sales of single-family homes fell 2.1% from the July total of 4.84 million to a seasonally adjusted annual rate of 4.74 million and is up 0.4% compared with August 2016. Sales of multifamily homes increased by 1.7% in August to a seasonally adjusted annual rate of 610,000 units.
All homes were on the market for an average of 30 days in August, equal to the July total and down from 36 days in August 2016. Foreclosure (3%) and short (1%) sales accounted for 4% of all August sales, down from 5% in July and 5% in August 2016.
The NAR also reported the following regional data:
August existing-home sales in the Northeast jumped 10.8% year over year to an annual rate of 720,000, up 1.4% compared with August 2016. The median price in the Northeast was $289,500, up 5.6% compared with August of last year.
In the Midwest, existing-home sales rose 2.4% to an annual rate of 1.28 million in August and were 0.8% higher than August 2016 sales. The median price in the Midwest was $200,500, up 5% from a year ago.
Existing-home sales in the South fell 5.7% in August to an annual rate of 2.15 million, and they are now 0.9% lower than August 2016 sales. The median price in the South was $220,400, up 5.4% from a year ago.
Existing-home sales in the West dropped 4.8% to an annual rate of 1.2 million in August and were 0.8% higher than August 2016 totals. The median price in the West was $374,700, up 7.7% compared with the August 2016 median.