One monthly figure concerning the stateside economy disappointed Tuesday. Figures released today by the National Association of Realtors revealed that sales of previously-owned U.S. homes declined in September, a sign that high prices and slim inventory continue to weigh on the housing sector despite low interest rates, strong employment and firmer wage growth.
NAR said existing-home sales fell 2.2% in September from the previous month to a seasonally-adjusted annual rate of 5.38 million. Economists expected sales tapered off 0.7% last month.
One bright spot: compared with a year earlier, sales in September rose 3.9%. Purchases of previously owned homes account for the bulk of U.S. home-buying. August’s sales were revised up slightly to a 5.50-million pace from an earlier estimate of a 5.49-million annual pace.
The housing market’s weakness has come despite many favorable conditions for potential buyers. Mortgage rates have been dropping steadily in recent months. The average interest rate on a 30-year fixed-rate mortgage at the end of September was 3.64%, down from about 4% six months earlier, according to Freddie Mac.
Still, a shortage of homes for sale in some areas means home prices remain high. The median sale price for an existing home in September was $272,100, up 5.9% from a year earlier. That marked 91 straight months of year-over-year price gains and the strongest pace of appreciation since January 2018. There was a 4.1 month-supply of homes on the market at the end of September, based on the current sales pace.
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