WASHINGTON — The U.S. existing home market showed signs of recovery in July, halting a four-month decline with a modest increase in sales, according to the National Assn. of Realtors. The latest NAR report shows that while prices continue to rise, inventory grew slightly and regional dynamics are playing a significant role.
Existing home sales rose 1.3% in July, reaching a seasonally adjusted annual rate of 3.95 million, marking the end of a four-month sales slump that began in March. While this rebound signals a recovery, it is tempered by the fact that sales are still down 2.5% compared to the same period last year. The improvement was driven by gains in the Northeast, South and West, while the Midwest remained stable.
“Despite the modest increase, home sales are still sluggish,” said Lawrence Yun, NAR chief economist. “But consumers are definitely seeing more choices and affordability is improving due to lower interest rates.”
The median existing home price in the U.S. rose 4.2% since July 2023, reaching $422,600. This is the 13th consecutive month of year-over-year price increases and underscores the ongoing affordability challenges for prospective buyers. Price increases occurred in all four major U.S. regions, with the Northeast seeing the largest increase at 8.3%, pushing its median price to $505,100.
Yun also emphasized the continued demand for detached single-family homes.
“The median home price for condos is lower, yet the condo market underperforms compared to the single-family home market,” he added. “Rising maintenance and insurance costs have reduced the attractiveness of condos.”
The inventory of unsold existing homes stood at 1.33 million units at the end of July, up slightly by 0.8% from June and 19.8% year-over-year. This represents a 4-month supply at the current sales pace, down slightly from the 4.1-month supply in June, but more than the 3.3-month supply starting in July 2023. The increased inventory provides buyers with more choices and could thus alleviate some of the upward pressure on prices.
Regionally, there were significant differences in the market, with the Northeast leading the pack with sales up 4.3% from June and 2.1% from July 2023. Sales also increased in the South and West, while sales in the Midwest were flat month-over-month and down 5.2% year-over-year.
These differences underscore the uneven recovery across the country, which is influenced by local economic conditions and housing market dynamics.
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