Home sales plunge 17% from a year ago in market’s slowest July since 2010 as short supply pushes prices higher despite brutal mortgage ratesSales of existing home dropped 17% in July from one year ago, new study findsHomeowners with low mortgage rates are clinging to houses and refusing to sellThe resulting low inventory is pushing home prices higher on an annual basis
Sales of existing US homes dropped to a six month-low in July, as home owners who are locked into cheap mortgages refrained from selling their properties, crimping inventory.
Despite falling sales volume, that limited inventory helped drive prices higher on a year-over-year basis for the first time since January, with the median home price hitting $406,700.
Existing home sales fell 2.2 percent in July from the prior month to a seasonally adjusted annual rate of 4.07 million, the National Association of Realtors said Tuesday.
Home resales, which account for a big chunk of US housing sales, slumped 16.6 percent compared with July last year. It was also the lowest level of home sales for the month of July since 2010.
The annual sales decline was steepest in markets across the Northeast and Midwest, where sales slumped 20 percent or more, though all regions experienced annual sales declines, the NAR said.
Sales fell in the Northeast, Midwest and South, but rose in the West, where home prices have fallen most sharply in the past year. All regions experienced annual sales volume declines.
Home prices have bottomed out after being pressured by the Federal Reserve’s aggressive interest rate hikes, but the persistent shortage of properties for sale could limit any rebound as many prospective buyers are forced out of the market.