Home sales up 2% in July as prices stayed nearly flat

By Brett Rowland
The Center Square

Home sales increased 2% last month after a lackluster spring selling season as prices cooled.

Existing-home sales increased by 2% in July, according to a report from the National Association of Realtors released Thursday. That’s a seasonally adjusted annual rate of 4.01 million and a 0.8% increase in sales year-over-year.

“The ever-so-slight improvement in housing affordability is inching up home sales,” NAR Chief Economist Lawrence Yun said. “Wage growth is now comfortably outpacing home price growth, and buyers have more choices.”

The median existing-home price for all housing types was up 0.2% to $422,400 from one year ago when it was $421,400. That’s the 25th consecutive month of year-over-year price gains.

“Near-zero growth in home prices suggests that roughly half the country is experiencing price reductions. Overall, homeowners are doing well financially. Only 2% of sales were foreclosures or short sales – essentially a historic low. The market’s health is supported by a cumulative 49% home price appreciation for a typical American homeowner from pre-COVID July 2019 to July this year,” Yun said.

Total housing inventory hit 1.55 million units, up 0.6% from June and 15.7% from July 2024 (1.34 million). NAR reported a 4.6-month supply of unsold inventory, down from 4.7 months in June and up from 4 months in July 2024. A six-month supply is generally considered a balanced market.

“Homebuyers are in the best position in more than five years to find the right home and negotiate for a better price. Current inventory is at its highest since May 2020, during the COVID lockdown.”

In July, homes spent a median of 28 days on the market, up from 27 days last month and 24 days in July 2024. First-time homebuyers accounted for 28% of sales last month, down from 30% in June and 29% in July 2024.

Cash sales remain popular. In July, 31% of transactions were cash sales, up from 29% a month ago and 27% in July 2024.

A fifth of transactions were individual investors or second-home buyers, up from 14% last month and 13% in July 2024.

The average 30-year fixed-rate mortgage was 6.72% in July, according to Freddie Mac, down from 6.82% in June and 6.85% one year ago.