Existing home sales fell 3.4% in May; The average selling price exceeds $400,000 for the first time

WASHINGTON (June 21, 2022) — Existing home sales fell for the fourth straight month in May, according to the National Association of Realtors®. Month-over-month sales declined in three of four major US regions, while year-over-year sales declined in all four regions.

In total Sale of existing properties,1 https://www.nar.realtor/existing-home-sales Completed transactions, which include single family homes, townhomes, condos and co-ops, fell 3.4% from April to a seasonally adjusted annualized rate of 5.41 million in May. Year-on-year, revenue fell 8.6% (5.92 million in May 2021).

“Home sales have essentially returned to — pre-pandemic — 2019 levels after two years of gangbuster performance,” said NAR chief economist Lawrence Yun. “Additionally, market moves in single-family home and condominium sales are nearly the same, possibly indicating that the preference for suburban living over city life that has existed over the past two years is easing as conditions return to pre-pandemic conditions.”

Entire housing stock2 There were 1,160,000 units at the end of May, up 12.6% from April and down 4.1% from a year earlier (1.21 million). Unsold inventory is at the current pace of supply for 2.6 months, up from 2.2 months in April and 2.5 months in May 2021.

“Further sales declines are expected in the coming months as housing affordability is challenged by the sharp rise in mortgage rates this year,” Yun added. “Nonetheless, reasonably priced homes are selling fast and inventories have yet to rise significantly – nearly doubling – to cool the rise in home prices and give home buyers more options.”

The median price for existing properties5 for all housing types was USD 407,600 in May, up 14.8% from May 2021 (USD 355,000) as prices increased in all regions. This marks 123 consecutive months of year-over-year increases, the longest-running streak on record.

Homes typically stayed on the market for 16 days in May, versus 17 days in April and 17 days in May 2021. 88 percent of homes sold in May 2022 were on the market for less than a month.

First-time buyers accounted for 27% of sales in May, up from 28% in April and up from 31% in May 2021. NAR’s 2021 Profile of home buyers and sellers – Released at the end of 20214 – reports that the annual share of first-time buyers is 34%.

Cash sales accounted for 25% of transactions in May, down from 26% in April and up from 23% in May 2021.

Individual investors, or second-home buyers, who make up many cash sales, bought 16% of homes in May, up from 17% in April and 17% in May 2021.

fire sales5 — Foreclosures and short sales — accounted for less than 1% of sales in May, essentially flat from April 2022 and May 2021.

According to Freddie Mac, the average commit rate on a 30-year conventional fixed-rate mortgage was 5.23% in May, up from 4.98% in April. The average commitment rate for the whole of 2021 was 2.96%.

Realtor.com®’s May Market Trends Report shows that the largest year-over-year average list price increases were in Miami (+45.9%), Nashville (+32.5%) and Orlando (+32.4%). . Austin reported the highest increase in the proportion of homes priced lower year-over-year (+14.7 percentage points), followed by Las Vegas (+12.3 percentage points) and Phoenix (+11.6 percentage points).

Sale of single-family houses and condominiums/cooperatives

Single-family home sales fell to a seasonally adjusted annual rate of 4.80 million in May, down 3.6% from April’s 4.98 million and down 7.7% from a year earlier. The median price for existing single-family homes in May was $414,200, up 14.6% from May 2021.

Existing condo and co-op sales recorded a seasonally adjusted annualized rate of 610,000 units in May, down 1.6% from April and down 15.3% from a year earlier. The median price of existing condos was $355,700 in May, up 14.8% annually.

“Declining home purchases means more people are renting, and the resulting increase in rents may encourage more institutional investors to buy single-family homes and convert them into rentals – putting additional financial strain on potential first-time buyers,” said NAR President Leslie Rouda Smith, Realtor® testifier Plano, Texas, and a broker at Dave Perry-Miller Real Estate in Dallas. “To counter this trend, policymakers should consider incentivizing the release of inventory into the market by temporarily reducing capital gains taxes to allow large investors to sell to first-time buyers.”

Regional Breakdown

Existing home sales in the Northeast rose 1.5% in May to an annualized rate of 680,000, down 9.3% from May 2021. The median price in the Northeast was $409,700, up 6.7% year-on-year.

Existing home sales in the Midwest fell 5.3% from the previous month to an annualized rate of 1,240,000 in May, down 7.5% from May 2021. The median price in the Midwest was $294,500, up 9.5% year over year.

Existing home sales in the South fell 2.8% in May to an annualized rate of 2,410,000, down 8.4% from a year earlier. The median price in the south was $375,000, up 20.6% year-on-year. For the ninth consecutive month, the South recorded the highest pace of price increases compared to the other three regions.

Existing home sales in the west fell 5.3% from the previous month to an annualized rate of 1,080,000 in May, down 10.0% from this time last year. The median price in the west was $633,800, up 13.3% from May 2021.

The National Association of Realtors® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industry.

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For local information please contact your local Realtors® Association for data from local Multiple Listing Services (MLS). Local MLS data is the most accurate source of sales and pricing information in specific territories, although there may be differences in reporting methodology.

NOTE: NAR’s Pending Home Sales Index for May is scheduled to be released on June 27th and June Existing Home Sales will be released on July 20th. Release times are 10:00 AM Eastern Time.

1 Existing home sales, which include single family homes, townhomes, condos and coops, are based on transaction completions from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR regularly ranks home sales using other sources to assess overall home sales trends, including sales not reported by MLSs.

Existing home sales based on closures differs from the US Census Bureau’s series on new single-family home sales based on contracts or acceptance of a down payment. Because of these differences, it’s not uncommon for each series to move in different directions in the same month. Additionally, existing home sales, which account for more than 90% of total home sales, are based on a much larger sample of data — about 40% of data from service providers with multiple entries per month — and are typically not subject to major previous months’ revisions.

The annual rate for a given month represents what the total number of actual sales would be for a year if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used when reporting monthly data to exclude seasonal variations in resale activity. For example, home sales volumes are typically higher in summer than in winter, mainly due to differences in weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Data collection for single-family homes began monthly in 1968, while data collection for condominiums began quarterly in 1981; The series were combined in 1999 when monthly condominium data collection began. Prior to this period, single-family homes accounted for more than nine out of ten purchases. Historical comparisons for total home sales prior to 1999 are based on monthly single-family home sales combined with the corresponding quarterly condo sales rate.

2 Total inventory and monthly supply data are available through 1999, while single-family inventory and monthly supply are available through 1982 (prior to 1999, single-family sales accounted for more than 90% of transactions and condominiums were only measured quarterly). Base).

3 At the median price, half sell for more and half sell for less; Medians are more typical of market conditions than average prices, which are skewed upwards by a relatively small proportion of high-end transactions. The only valid comparisons for median prices are with the same period one year earlier due to the seasonality of purchasing behavior. Monthly comparisons do not compensate for seasonal changes, particularly the timing of family purchasing behavior. Changes in the composition of sales can distort median price data. Median and average prices from the previous year are sometimes revised in an automated process as additional data is received.

The national median price for condominiums/cooperatives is often higher than the median price for single-family homes because condos are concentrated in the more expensive housing markets. However, in a given area, single-family homes tend to sell for more than condos, according to NAR’s quarterly price reports for metro areas.

4 Survey results are for owner-occupiers and differ from separately reported monthly results from NAR’s Realtors® Confidence Index, which includes all types of buyers. Investors are underrepresented in the annual study because survey questionnaires are mailed to the addresses of properties purchased and are generally not returned by absentee owners. Results include both new and existing homes.

5 Distressed sales (foreclosures and short sales), days on the market, first-time buyers, all-cash transactions and investors are from a monthly survey for NAR’s Realtors® Confidence Index, published on nar.realtor.

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