According to the National Association of Real Estate Agents, pending sales of existing homes in June, as measured by signed contracts, fell 1.9% from May.
Sales also decreased by 1.9% compared to June 2020. Pending sales are a positive indicator of closed sales in a month or two.
“Sales have been sluggish since January, marking a turning point in the market,” said Lawrence Yun, chief economist at the National Association of Realtors. “Buyers are still interested and want to own a home, but record high home prices are pushing some people back.”
According to the latest information from the S & P Case-Shiller National Home Price Index, prices in May were up about 17% compared to May 2020. This is the largest annual profit ever. June prices could be well above that, especially given the still tight supply of homes for sale at the low end of the market.
The price is high because the stock is very low. But it’s starting to change. According to Realtor.com, the number of newly listed homes in June increased by 5.5% compared to June 2020.
George Ratiu, Senior Economist at Realtor.com, said:
Regionally, pending sales in June increased 0.5% compared to May, up 8.7% from a year ago. In the Midwest, sales increased 0.6% monthly but decreased 2.4% annually.
In the South, pending sales fell 3% and 4.7% per month from June 2020. In the west, sales fell 3.8% monthly and 2.6% annually.
Mortgage rates rose slightly at the beginning of June, but this was only added to the issue of affordability. After that, prices fell again by the end of the month. Yun predicts that mortgage rates will rise more steadily towards the end of the year.
“This rise will ease demand and cool price increases,” he added.
According to the US Census, new home sales counted in signed contracts also declined in June, down 6% per month and almost 20% year-over-year.
June pending home sales decline
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