US existing home sales fell in September by the most in over two years as the housing market continued to struggle despite strength across the broader economy, said the National Association of Realtors Monday. Existing home sales dropped 3.4 percent to a seasonally adjusted annual rate of 5.15 million units last month.
Home sales have now fallen for six straight months. A dearth of properties for sale has pushed up prices, sidelining many would-be homeowners. Sales dropped the most in the South and the decline in the West left sales there down 12.2 percent from a year earlier.
Purchases of existing homes account for most of US home-buying activity. Supply has also been constrained by rising building material costs as well as land and labour shortages, while rising mortgage rates are expected to slow demand.
Those price gains are fueled by demand — homes stayed on the market for only 32 days on average, compared with 34 days a year earlier. There’s also a lack of supply, with inventories ticking up yet remaining tight.
Highlights of Existing-Home Sales (September):
- Contract closings fell from the prior month to 5.15m annual rate, the lowest since Nov. 2015 (est. 5.29m).
- Median sales price rose 4.2% y/y to $258,100.
- Inventory of available properties edged up 1.1% y/y to 1.88m.
Sales of single-family homes and condominium and co-op units both dropped 3.4 percent from the prior month. There were 1.88 million homes on the market in September, an increase of 1.1 percent from a year ago.
At September’s sales pace, it would take 4.4 months to clear the current inventory. A supply of six to seven months is viewed as a healthy balance between supply and demand.
The median house price increased 4.2 percent from one year ago to US$258,100 in September.