US existing-home sales fell 1.7% in July to three-month low as record prices, high mortgage rates stifle would-be buyers

U.S. existing-home sales fell 1.7% in July, marking a three-month low at an annualized rate of 4.06 million units, according to the National Association of Realtors (NAR). This decline is attributed to high mortgage rates and record prices that are stifling potential buyers.⁶

The U.S. median sales price rose 2% from a year earlier, reaching $434,100, while the inventory of unsold homes decreased by 1.9% to 1.54 million units. This inventory level translates to a 4.6-month supply at the current sales pace, indicating a tight market, as traditionally a balanced market requires a 5- to 6-month supply.³⁴⁵

“Home sales have been remarkably stable, even amid the rising mortgage rate environment of the past few months,” said Lawrence Yun, NAR’s chief economist. He noted that the housing market would thrive if average mortgage rates returned near 6%.

The 30-year fixed mortgage rate rose to 6.69%, its highest level in over a year, marking the fifth consecutive week of increases. This rise in rates is discouraging homeowners from selling, further exacerbating the housing shortage. “If no one is selling, no one can be buying, and inventories are low,” said Carl Weinberg, chief economist at High Frequency Economics.

First-time buyers accounted for 29% of sales, down from 33% in June, highlighting the challenges faced by this demographic in a market where houses priced below $250,000 are in short supply.