WASHINGTON–For the second month in a row, August showed a decline in the sales of previously owned homes as the inventory of homes for sale continues to grow smaller.
According to the National Association of Realtors, sales of existing homes declined 0.9% to a seasonally adjusted annual rate of 5.33 million. That’s just 0.8% higher than a year ago, although year to date figures are 3% higher, the NAR said.
According to NAR projections, at the current pace of sales it would require 4.6 months to exhaust all inventory, lower than the six months that’s traditionally been the marker of a balanced market. Inventory was lower compared to a year ago for the 15th straight month in August, the NAR said.
Meanwhile, not surprisingly, as supply has gotten tighter prices have risen. The median sales price was $240,000, which is 5.1% higher than in August 2015.
First-time homebuyers comprised 31% of the market in August.
Meanwhile, mortgage rates have declined slightly, according to Freddie Mac. It’s most recent data show:
- The 30-year fixed-rate mortgage (FRM) averaged 3.48% with an average 0.6 point for the week ending September 22, 2016, down from last week when it averaged 3.50%. A year ago at this time, the 30-year FRM averaged 3.86%.
- 15-year FRM this week averaged 2.76% with an average 0.5 point, down from last week when it averaged 2.77%. A year ago at this time, the 15-year FRM averaged 3.08%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.80% this week with an average 0.5 point, down from last week when it averaged 2.82%. A year ago, the 5-year ARM averaged 2.91%.
Despite the decrease in rates, the Freddie’s Refinance Index declined 8% to its lowest level since June.”