Existing-home sales slide in June

Existing-home sales were knocked down a peg last month -- decreasing 1.8% -- as low supply and high prices held some homeowners back.

Total existing-home sales reached a seasonally adjusted annual rate of 5.52 million in June, down from 5.62 million in May. However, June's pace is still 0.7% ahead of last year.

Single-family home sales dipped 2.0% to a seasonally adjusted annual rate of 4.88 million in June from 4.98 million in May, but are still 0.6% above last year.

"Closings were down in most of the country last month because interested buyers are being tripped up by supply that remains stuck at a meager level and price growth that's straining their budget," said Lawrence Yun, NAR chief economist. "The demand for buying a home is as strong as it has been since before the Great Recession. Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines."

Added Yun, "The good news is that sales are still running slightly above last year's pace despite these persistent market challenges."

Housing inventory decreased further at the end of June, declining 0.5% to 1.96 million existing homes available for sale (down 7.1% over last year). This number has fallen year-over-year for 25 consecutive months, and this unsold inventory represents a 4.3-month supply at the current sales pace.

The median existing-home price in June was $263,800, up 6.5% from June 2016 ($247,600). This surpasses May as the new peak and is the 64th straight month of year-over-year gains. For single-family homes, the median price was $266,200, up 6.6%.

First-time buyers also represented 32% of sales in June, which is down from 33% both in May and a year ago.

"It's shaping up to be another year of below average sales to first-time buyers despite a healthy economy that continues to create jobs," said Yun. "Worsening supply and affordability conditions in many markets have unfortunately put a temporary hold on many aspiring buyers' dreams of owning a home this year."

Regionally, only the Midwest saw any gains in existing-home sales last month, rising 3.1%. Activity in the South dropped most dramatically (4.7%).