Home prices soared to a new peak in June for the second straight month. Underscoring the persistent challenge of affordability in the U.S. housing market. This trend highlights the ongoing struggle for millions of Americans seeking to purchase homes amidst rising costs.
Spring Home-Buying Season Falls Short
This year’s spring home-buying season, typically the most active period for real estate transactions, proved disappointing. Home sales declined for the fourth consecutive month in June, a trend driven by a combination of high prices and elevated mortgage rates. These factors have rendered homeownership less attractive to potential buyers and discouraged current homeowners from moving.
Limited Inventory Drives Prices Up
Despite an increase in the number of homes on the market in recent months, inventory remains well below historical averages, contributing to higher prices. The national median price for existing homes in June reached a record high of $426,900, according to the National Association of Realtors (NAR). This figure represents a 4.1% increase from the previous year and is the highest since data collection began in 1999. These prices are not adjusted for inflation.
The shortage of available homes often leads to bidding wars, especially for desirable properties. Over one-third of Home Prices in June were completed at prices exceeding the list price, as reported by real estate brokerage Redfin. Additionally, while luxury home sales increased compared to the previous year, sales of more affordable homes declined, further pushing up the median price.
Sales Decline and Inventory Shifts
Existing-home sales in June fell by 5.4% from the previous month, resulting in a seasonally adjusted annual rate of 3.89 million. On a year-over-year basis, sales also decreased by 5.4%. Certainly! Here’s the Despite an increase in inventory, Lawrence Yun, NAR’s chief economist, noted, “We are seeing more inventory. However, we are not seeing increased sales.” We may be transitioning from a sellers’ market toward a more balanced or even buyers’ market.”

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Possible Improvement in Affordability
Affordability for home buyers reached its lowest point last fall since 1985 and has remained near multidecade lows. However, economists suggest a potential improvement in the coming months. Mortgage rates recently fell to their lowest level since mid-March, according to Freddie Mac, and the pace of home-price growth is slowing as inventory increases.
By the end of June, there were 1.32 million homes for sale or under contract, a 3.1% increase from May and a 23.4% rise from June 2023, NAR reported. This increase in inventory is reflected in the 4.1-month supply of homes on the market. This is the highest level since May 2020.
Regional Inventory Trends
Inventory levels varied significantly by region. The South saw the largest year-over-year increase in inventory. In contrast, the Midwest and Northeast experienced more limited availability. In Chagrin Falls, Ohio, Russell and Nicole Chiles sold their home for $630,000. This was nearly 10% above the listing price. The sale followed the receipt of three offers on the first day. In Western Ohio, where the Chileses moved for a new job, finding a suitable home proved challenging. As a result, they ended up purchasing a property that was not yet on the market.
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