Existing home sales dropped to a pace of 5.5 million in May, according to online real estate transaction marketplace Ten-X.
Ten-X’s Residential Real Estate Nowcast predicted that on a seasonally adjusted annual rate, existing home sales would decline from a 5.57 million pace in April to somewhere between a 5.37 and 5.73 million pace in May – a decrease of around 1.2% from the April sales reported by the National Association of Realtors – and down .54% from the year before.
"Two consecutive months of weaker existing home sales isn't cause for panic, but it does suggest that forecasts calling for a robust housing market may have been too optimistic," said Rick Sharga, Ten-X executive vice president and chief marketing officer. "It appears that the combination of extraordinarily low inventory and home-price appreciation that continues to outpace wage growth is slowing down sales, especially in some of the country's higher-priced markets."
As for May existing-home prices, Ten-X Nowcast projects annual prices between $237,570 and $262,577 with a target price point of $250,074. This is a 2.2% increase from April and a 4.3% increase from May of 2016.
"Despite inventory constraints continuing to fuel price gains and curb affordability, demand is healthy and relatively low mortgage rates have enabled more buyers to enter the market," said Ten-X Chief Economist Peter Muoio. "While there is some uncertainty over the possibility of another rate hike and its impact on affordability, the housing market remains on solid footing supported by a firm labor market and rising wages."
US growth better than estimated
