The housing market cooled in July as inventory remains at inadequate levels in many regions, particularly in the starter-home category. Affordability appears to be impacting prospective buyers despite near record-low mortgage rates. After several consecutive months of steady growth, home sales declined over the year prior for the first time since November 2015.
Interest Rates
Interest rates remain near all-time lows. Mortgage rates have remained flat; however, Fed Chair Janet Yellen has hinted that conditions are such that an increase in the interest rate may be coming later in the year.
Home Sales
The National Association of REALTORS® reported home sales at a seasonally adjusted annual rate of 5.4 million homes during the month of July. This was a decrease of 3.2 percent from June, and a decrease of 1.6 percent from July of last year.
Home Prices
The median home price decreased to $244,100 in July, which was down 1.4 percent from June and up 5.3 percent from July of last year. The median home price has increased by nearly $12,300 in the past year alone.
Inventory
There was a 4.7-month supply of housing inventory in July, which increased slightly from June. The total number of homes for sale decreased by 4.1 percent compared to July of last year.
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