Existing-Home Sales Rise as Prices Hit a Record

Sales of existing homes rose 1.4 percent in June, to a 5.86 million seasonally adjusted annual (see top of first chart). Sales are up 22.9 percent from a year ago. Sales in the market for existing single-family homes, which account for about 88 percent of total existing-home sales, also rose 1.4 percent in June, coming in at a 5.14 million seasonally adjusted annual rate (see top of first chart). From a year ago, sales are up 19.3 percent. Condo and co-op sales rose 1.4 percent for the month, leaving sales at 720,000 for the month versus 710,000 in May.

The median sale price in June of an existing home was $381,800, 16.1 percent above the year ago price and a new record high. For single-family existing home sales in June, the price was $386,600, a 16.7 percent rise over the past year and also a new record (see second chart), while the median price for a condo/co-op was $347,200, 13.8 percent above June 2020 (see second chart).

The record-high prices are helping push up inventory. Total inventory of existing homes for sale rose 3.3 percent to 1.25 million in June, pushing the months’ supply (inventory times 12 divided by the annual selling rate) to 2.6, the highest since September 2020 though still a very low supply by historical measure.

For the single-family segment, inventory increased 3.8 percent to 1.08 million, the highest since November 2020 (see bottom of first chart). The months’ supply was unchanged at 2.5 (see bottom of first chart). The condo and co-op inventory fell 1.2 percent to 171,000, putting the months’ supply at 2.9, unchanged from the prior month. 

Rising prices are pushing some buyers out of the market, helping to slow sales and ease the tight supply. Additionally, some fading of the rush out of dense urban areas for suburban housing or rural country homes may also be undermining housing demand. Housing is likely to be volatile over the coming months as fundamentals adjust to changing market conditions. The recent rebound in Covid cases related to the Delta variant is boosting uncertainty.