Connect with us

Hi, what are you looking for?

Business Insider

August home sales drop more than expected as prices set a record

Sales of previously owned homes fell 2.5% in August from July, to a seasonally adjusted annualized rate of 3.86 million units, according to the National Association of Realtors.

That is slightly lower than what analysts expected. Sales were 4.2% lower than August 2023. It marks three straight months of sales below the 4 million mark, annualized.

This count is based on closings — contracts that were likely signed in late June and July, when mortgage rates started coming down but were not as low as they are today. The average rate on the popular 30-year fixed loan was slightly over 7% in mid-June and then fell steadily to 6.7% by the end of July, according to Mortgage News Daily.

“Home sales were disappointing again in August, but the recent development of lower mortgage rates coupled with increasing inventory is a powerful combination that will provide the environment for sales to move higher in future months,” said Lawrence Yun, NAR’s chief economist. “The home-buying process, from the initial search to getting the house keys, typically takes several months.”

The inventory of homes for sale is improving slightly. There were 1.35 million units for sale at the end of August. That’s up 0.7% from July and 22.7% year over year. It is still, however, just a 4.2-month supply. A 6-month supply is considered balanced between buyer and seller.

“The rise in inventory — and, more technically, the accompanying months’ supply — implies home buyers are in a much-improved position to find the right home and at more favorable prices,” Yun added. “However, in areas where supply remains limited, like many markets in the Northeast, sellers still appear to hold the upper hand.”

Tight supply is keeping the pressure on prices. The median price of an existing home sold in August was $416,700, up 3.1% from the same month in 2023. That is the highest price ever for August.

Since it’s a median, though, part of that gain is skewed toward what was selling in August. Sales were up significantly for homes priced above $750,000, but down for anything priced below $500,000.

First-time buyers made up just 26% of August sales, matching the all-time low from November 2021. All-cash sales came in at 26%, which is down slightly from a year ago but still high historically.

Mortgage rates continued to fall in August and September, with the 30-year fixed now sitting at 6.15%, the lowest in roughly two years.

This post appeared first on NBC NEWS
Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

You May Also Like

Editor’s Choice

[#item_full_content]

Editor’s Choice

[#item_full_content]

Disclaimer: KingOfCashSecrets.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2024 KingOfCashSecrets. All Rights Reserved.