In June, sales of pre-owned homes declined by 3.3% compared to May, reaching a seasonally adjusted annualized rate of 4.16 million units, as reported by the National Association of Realtors.

Compared to the same month last year, sales were down by 18.9%, marking the slowest sales pace for June since 2009.

The main factor behind the ongoing weakness in the housing market is not due to a lack of demand but rather a critical shortage of supply.

By the end of June, there were only 1.08 million homes available for sale, which is 13.6% less than the inventory in June 2022, CNBC reported.

At the current rate of sales, this represents a 3.1-month supply, well below the balanced level of a six-month supply that benefits both buyers and sellers.

Lawrence Yun, the chief economist for the Realtors, pointed out the significant issue: the market is struggling due to the scarcity of available homes for sale.

He mentioned that the market could readily handle a doubling of inventory.

The limited supply of homes is keeping pressure on home prices. In June, the median price of an existing home sold reached $410,200, marking the second-highest price ever recorded by the Realtors.

While last June’s price was slightly higher, this year’s median price reflects the current market conditions, especially with mortgage rates notably higher compared to the previous year.

As a result, the low end of the market is currently the most active segment.

Written by staff