By Geoffrey Smith and Scott Kanowsky
Investing.com -- The number of sales of existing homes fell sharply in June, adding to a miserable month for data from a slowing housing market.
The National Association of Realtors said existing home sales slumped to 5.12 million last month from 5.41 million in May. That was the fifth straight monthly decline, well below a consensus forecast for 5.38 million, and the biggest drop in four months. It was also the lowest number of monthly transactions since June 2020.
The NAR said that sales were down in year-on-year terms in all four of the regional markets that it tracks.
The data come hard on the heels of figures from the Mortgage Bankers Association earlier Wednesday, which showed mortgage demand at its lowest in over 20 years as customers baulk at taking out loans at ever-higher interest rates.
Various other data this week have also suggested that the housing boom triggered by the pandemic, which created fresh demand for bigger houses and interest rates low enough to pay for them, is now cooling off sharply as the Federal Reserve raises its official interest rates. The National Association of Home Builders' monthly index of housing market activity fell by the most on record in June, while housing starts and building permits also both fell.
"Falling housing affordability continues to take a toll on potential home buyers," said NAR Chief Economist Lawrence Yun. "Both mortgage rates and home prices have risen too sharply in a short span of time."
The MBA's reference rate for 30-year mortgages has risen from around 3.30% at the turn of the year to 5.82% as of last week, an increase of over two and a half percentage points, adding hundreds of dollars to the average monthly repayment check.
The median existing-home price for all housing types in June was $416,000, up 13.4% from a year earlier, a more modest increase than S&P Global's national benchmark for all home sales, which was up over 21% in May. The NAR said this marks 124 consecutive months of year-over-year increases, the longest-running streak on record.
The NAR also noted that unsold inventory is starting to tick up, as buyers become more resistant to paying top-notch prices. Even so, properties still took only two weeks, on average, to find a buyer, down from 17 days a year earlier.