Existing home sales are remaining steady after several months of decline, according to a report from the National Association of Realtors (NAR). According to the August 2018 NAR Existing Home Sales Report, remained unchanged from July to August, at 5.34 million. NAR notes that sales are still down 1.5 percent year over year, from 5.42 million in August 2017.
According to Lawrence Yun, NAR Chief Economist, robust regional sales have led to the leveling of sales out after months of falling.
Strong gains in the Northeast and a moderate uptick in the Midwest helped to balance out any losses in the South and West, halting months of downward momentum,” said Yun. “With inventory stabilizing and modestly rising, buyers appear ready to step back into the market.”
Danielle Hale, Chief Economist for Realtor.com, commented on how the state of existing home sales reflects the limited inventory.
“Existing home sales continued to struggle in August," said Hale. "While they were unchanged from July, the slip from last year marks the sixth straight month of yearly declines. Although the listings decline is slowing and inventories increased slightly from last August, sales still reflect the fact that we’ve been in the midst of the largest inventory shortage of all-time for the last three years. Unfortunately, the picture isn’t getting rosier any time soon, thanks to Hurricane Florence. Before the hurricane, the Carolinas accounted for about 6 percent of U.S. homes for-sale and with many homeowners still displaced, property damage is expected to be extensive.”
Inventory also remained unchanged month over month at 1.92 million existing homes available for sale, up from 1.87 million a year ago. According to NAR, the unsold inventory represents a 4.3-month supply at the current sales pace, also unchanged with July, and up from 4.1 year over year.
“While inventory continues to show modest year over year gains, it is still far from a healthy level and new home construction is not keeping up to satisfy demand,” said Yun. “Homes continue to fly off the shelves with a majority of properties selling within a month, indicating that more inventory – especially moderately priced, entry-level homes – would propel sales.”
While other indices stayed steady month over month, the number of first-time buyers fell, from 32 percent in July to 31 percent in August. NAR notes that this is the same number year over year.
“Rising interests rates along with high home prices and lack of inventory continues to push entry-level and first time home buyers out of the market,” said Yun. “Realtors continue to report that the demand is there – that current renters want to become homeowners – but there simply are not enough properties available in their price range.”
Find the full NAR report here.