Single family housing starts fall in July | Bedford Corners Real Estate

A sharp decline in single-family home construction is another indicator that the housing slowdown is showing no signs of abating, as rising construction costs, elevated mortgage rates and supply chain disruptions continue to act as a drag on the market.

Overall housing starts fell 9.6% to a seasonally adjusted annual rate of 1.45 million units in July, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The July reading of 1.45 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months.

Single-family starts decreased 10.1% to a 916,000 seasonally adjusted annual rate and are down 2.1% on a year-to-date basis. This is the lowest reading for single-family home building since June 2020. More declines lie ahead, as single-family permits decreased 4.3% to a 928,000 unit rate and are down 5.9% on a year-to-date basis. NAHB is forecasting 2022 to be the first year since 2011 to record an annual decline in single-family home building.

A housing recession is underway with builder sentiment falling for eight consecutive months, while the pace of single-family home building has declined for the last five months. The decline in single-family starts is reflected in the HMI measure of builder sentiment, as housing demand continues to weaken on higher interest rates while on the supply side builders continue to grapple with higher construction costs. Builders are reporting weakening traffic as housing affordability declines.

The multifamily sector, which includes apartment buildings and condos, decreased 8.6% to an annualized 530,000 pace. Multifamily construction remains very strong given solid demand for rental housing. The number of multifamily 5+ units currently under construction is up 24.8% year-over-year. Multifamily development is being supported by a substitution effect, with frustrated or priced out prospective home buyers seeking rental housing.

The number of single-family homes permitted but not started construction has likely peaked after rising over pervious quarters due to supply-chain issues. In July, there were 146,000 homes authorized but not started construction. This reading is flat year-over-year. In contrast, the number of multifamily 5+ units permitted but not started construction continues to rise, up 47% year-over-year to 147,000 units.

On a regional and year-to-date basis, combined single-family and multifamily starts are 10.7% higher in the Northeast, 0.4% lower in the Midwest, 6.5% higher in the South and 2.2% lower in the West. Looking at regional permit data on a year-to-date basis, permits are 1.9% lower in the Northeast, 1.9% higher in the Midwest, 2.6% higher in the South and 0.2% higher in the West.

As an indicator of the economic impact of housing and as a result of accelerating permits and starts in recent quarters, there are now 816,000 single-family homes under construction. This is 17% higher than a year ago. There are currently 862,000 apartments under construction, up 25% from a year ago with this number continuing to rise. Total housing units now under construction (single-family and multifamily combined) is 21% higher than a year ago. The number of single-family units in the construction pipeline is now falling and will continue to decline in the months ahead given recent declines in buyer traffic.

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eyeonhousing.org

NAHB builder confidence survey drops into contraction | Chappaqua Real Estate

NAHB chief economist says Fed policy & high construction costs will cause first decline in housing starts since 2011.

KEY TAKEAWAYS

  • For the first time since May 2020, the monthly NAHB/Wells Fargo Housing Index fell below the break-even measure of 50.
  • Roughly one-in-five (19%) home builders in the HMI survey reported reducing prices in the past month to increase sales or limit cancellations,.
  • Meanwhile, 69% of builders reported higher mortgage interest rates as the reason behind falling housing demand.

Builder confidence is sinking like a stone, in part the result of what an economist for the National Association of Home Builders (NAHB) now calls a “housing recession.”

NAHB today released the results of its monthly survey of home builders, which found that builder confidence in the market for newly built single-family homes fell for the eighth straight month in August, amid continuing supply-chain problems, high materials prices, and falling home affordability.

In fact, for the first time since May 2020, the monthly NAHB/Well Fargo Housing Index fell below the break-even measure of 50, declining six points to 49, the NAHB said.

“Tighter monetary policy from the Federal Reserve and persistently elevated construction costs have brought on a housing recession,” said NAHB Chief Economist Robert Dietz. “The total volume of single-family starts will post a decline in 2022, the first such decrease since 2011.”

Dietz noted, however, that “as signs grow that the rate of inflation is near peaking, long-term interest rates have stabilized, which will provide some stability for the demand-side of the market in the coming months.”

The latest report on inflation, released last week, showed that the Consumer Price Index in July was unchanged from June, and had dipped to 8.5% year over year from 9.1% in June.

NAHB Chairman Jerry Konter, a home builder and developer from Savannah, Ga., said the survey shows ongoing increases in construction costs and mortgage rates continue to weaken market sentiment for single-family home builders. “And in a troubling sign that consumers are now sitting on the sidelines due to higher housing costs, the August buyer traffic number in our builder survey was 32, the lowest level since April 2014 with the exception of the spring of 2020, when the pandemic first hit.”

Roughly one-in-five (19%) home builders in the HMI survey reported reducing prices in the past month to increase sales or limit cancellations, the NAHB said. The median price reduction was 5% for those reporting using such incentives. Meanwhile, 69% of builders reported higher mortgage interest rates as the reason behind falling housing demand, the top impact cited in the survey.

All three HMI components posted declines in August, with each falling to their lowest level since May 2020. Current sales conditions dropped seven points to 57; sales expectations in the next six months declined two points to 47; and traffic of prospective buyers fell five points to 32.

Looking at the three-month moving averages for regional HMI scores, the Northeast fell nine points to 56, the Midwest dropped three points to 49, the South fell seven points to 63, and the West posted an 11-point decline to 51.

Derived from a monthly survey that NAHB has conducted for more than 35 years, the HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index, for which any number over 50 indicates that more builders view conditions as good than poor.

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gageprofessional.com

Housing price appreciation slows in June | Amonk Real Estate

Rising mortgage rates and inflation in the wider economy caused housing demand to drop sharply in June, forcing home prices to cool down.

Home prices are still higher than they were a year ago, but the gains slowed at the fastest pace on record in June, according to Black Knight, a mortgage software, data and analytics firm that began tracking this metric in the early 1970s. The annual rate of price appreciation fell two percentage points from 19.3% to 17.3%.

Price gains are still strong because of an imbalance between supply and demand. The housing market has had a severe shortage for years. Strong demand during the coronavirus pandemic exacerbated it.

Even when home prices crashed dramatically during the recession of 2007-09, the strongest single-month slowdown was 1.19 percentage points. Prices are not expected to fall nationally, given a stronger overall housing market, but higher mortgage rates are certainly taking their toll.

The average rate on the 30-year fixed mortgage crossed over 6% in June, according to Mortgage News Daily. It has since dropped back in the lower 5% range, but that is still significantly higher than the 3% range rates were in at the start of this year.

“The slowdown was broad-based among the top 50 markets at the metro level, with some areas experiencing even more pronounced cooling,” said Ben Graboske, president of Black Knight Data & Analytics. “In fact, 25% of major U.S. markets saw growth slow by three percentage points in June, with four decelerating by four or more points in that month alone.”

Still, while this was the sharpest cooling on record nationally, the market would have to see six more months of this kind of deceleration for price growth to return to long-run averages, according to Graboske. He calculates that it takes about five months for interest rate impacts to be fully reflected in home prices.

Markets seeing the sharpest drops are those that previously had the highest prices in the nation. Average home values in San Jose, California, have fallen 5.1% in the last two months, the biggest drop of any of the top markets. That chopped $75,000 off the price.

In Seattle, prices are down 3.8% in the past two months, or a $30,000 reduction. San Francisco, San Diego and Denver round out the top five markets with the biggest price reductions.

The cooling in prices coincides with a sharp jump in the supply of homes for sale, up 22% over the last two months, according to Black Knight. Inventory is still, however, 54% lower than 2017-19 levels.

“With a national shortage of more than 700,000 listings, it would take more than a year of such record increases for inventory levels to fully normalize,” said Graboske.

Price drops will not affect the average homeowner as much as they did during the Great Recession, because homeowners today have considerably more equity. Tight underwriting, and several years of strong price appreciation caused home equity levels to hit record highs.

Despite that, the strong demand in the market recently could present a problem for some. About 10% of mortgaged properties were purchased in the last year, so price drops could cause some borrowers to edge much lower in their equity positions.

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cnbc.com

Pending home sales down 20% | North Salem Real Estate

Pending home sales decreased in June, following a slight increase in May, according to the National Association of REALTORS®. All four major regions posted month-over-month and year-over-year pullbacks, the largest of which occurred in the West.

The Pending Home Sales Index (PHSI),* www.nar.realtor/pending-home-sales, a forward-looking indicator of home sales based on contract signings, dipped 8.6% to 91.0 in June. Year-over-year, transactions shrank 20.0%. An index of 100 is equal to the level of contract activity in 2001.

“Contract signings to buy a home will keep tumbling down as long as mortgage rates keep climbing, as has happened this year to date,” said NAR Chief Economist Lawrence Yun. “There are indications that mortgage rates may be topping or very close to a cyclical high in July. If so, pending contracts should also begin to stabilize.”

According to NAR, buying a home in June was about 80% more expensive than in June 2019. Nearly a quarter of buyers who purchased a home three years ago would be unable to do so now because they no longer earn the qualifying income to buy a median-priced home today.

“Home sales will be down by 13% in 2022, according to our latest projection,” Yun added. “With mortgage rates expected to stabilize near 6% and steady job creation, home sales should start to rise by early 2023.”

June Pending Home Sales Regional Breakdown

The Northeast PHSI slid 6.7% compared to last month to 80.9, down 17.6% from June 2021. The Midwest index dropped 3.8% to 93.7 in June, a 13.4% decline from a year ago.

The South PHSI slipped 8.9% to 108.3 in June, a decrease of 19.2% from the previous year. The West index slumped 15.9% in June to 68.7, down 30.9% from June 2021.

The National Association of REALTORS® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.

# # #

*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

Pending contracts are good early indicators of upcoming sales closings. However, the amount of time between pending contracts and completed sales is not identical for all home sales. Variations in the length of the process from pending contract to closed sale can be caused by issues such as buyer difficulties with obtaining mortgage financing, home inspection problems, or appraisal issues.

The index is based on a sample that covers about 40% of multiple listing service data each month. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.NOTE: Existing-Home Sales for July will be reported on August 18. The next Pending Home Sales Index will be on August 24. All release times are 10 a.m. Eastern.

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nar.realtor/newsroom/

Mortgage applications for new homes drop 12% | South Salem Real Estate

Mortgage applications for new-home purchases in June decreased 12% compared with a year ago, according to the latest Mortgage Bankers Association (MBA) Builder Application Survey (BAS). Compared with May, applications decreased by 10%.

“Higher mortgage rates and heightened economic uncertainty cooled borrower demand in June, leading to new-home purchase applications declining to the lowest level since April 2020,” says Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Additionally, new residential construction and permitting activity weakened from March through May, reducing the number of homes available for home buyers. MBA’s estimate of new-home sales for June fell to a pace of 620,000 homes, a 15% drop of over 100,000 units compared to May.”

The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 620,000 units in June, based on data from the BAS. The new-home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.

The seasonally adjusted estimate for June is a decrease of 14.7% from the May pace of 727,000 units. On an unadjusted basis, MBA estimates that there were 57,000 new-home sales in June, a decrease of 6.6% from 61,000 new-home sales in May.

By product type, conventional loans composed 73.7% of loan applications, FHA loans composed 15%, RHS/USDA loans composed 0.5%, and VA loans composed 10.7%. The average loan size of new homes decreased from $430,855 in May to $426,966 in June.

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builderonline.com/

Residential construction prices up 12% | Waccabuc Real Estate

The prices of goods used in residential construction climbed 1.5% in June (not seasonally adjusted) even as softwood lumber prices fell 23%, according to the latest Producer Price Index (PPI) report. Prices have surged 41.7% since January 2020. Building materials (i.e., goods inputs to residential construction, less energy) prices have increased 4.8%, year-to-date, and are 12.2% higher than they were in June 2021.

The price index of services inputs to residential construction was driven 2.1% lower in June after a 2.0% decline in May (revised) by decreases in the building materials retail and wholesale trade indices. The services PPI is 0.1% lower than it was 12 months prior and 37.6% higher than its pre-pandemic level.

Softwood Lumber

The PPI for softwood lumber (seasonally adjusted) fell sharply (-22.6%) in June, its second such decline in three months. Prices have fallen 35.0% since March 2022, although the extent to which the decrease has reached home builders and remodelers is unclear.

Since early 2020, softwood lumber prices have been extraordinarily volatile. The average monthly change in the PPI for softwood lumber has been 2.6% since January 2020, nearly nine times the average change (+0.3%) from 1947 to 2020. The volatility of softwood lumber prices has exhibited the same pattern relative to the “all commodities” PPI. While lumber prices were 19.7% more volatile over the 1947-2020 period, they have been 100.1% more volatile than the broader index since January 2020.

Ready-Mix Concrete

The PPI for ready-mix concrete (RMC) gained 1.9% in June following increases in May (+0.8%) and April (+1.1%). The index has climbed 5.1%, year-to-date, and 11.3% over the past 12 months. Over the two decades beginning January 2000, the price of RMC moved more than 1% in 24 of 240 survey months. It has increased/decreased more than 1% in seven of the 30 months since, including three times through the first half of 2022.

Price changes were broad based geographically but increased the most in the Northeast where they rose 6.3% in June. Prices also increased in the South (+0.9%), Midwest (+1.6%), and West (+1.0%). Although prices are higher than pre-pandemic levels in all regions, the variance of increases across regions is quite large, ranging from 10.6% in the Midwest to 23.2% in the West.

Gypsum Products

The PPI for gypsum products increased 0.1% in June after surging 7.1% in May. and has soared 22.6% over the past year. After a quiet 2020, the price of gypsum products climbed 23.0% in 2021 and is up 7.6% through the first half of 2022.

Steel Products

Steel mill products prices decreased 1.8% in June after increasing 13.6% over the two prior months. 10.7%. Although prices are 6.5% below their all-time high (reached in December 2021), they are twice January 2021 levels.

Paint

The PPI for architectural coatings (i.e., paint) was flat over the month as the price of exterior paint gained 0.1% and that of interior paint did not change. The PPI for paint has not declined since January 2021—the prices of exterior and interior paint have risen 49.3% and 33.2%, respectively, in the months since.

Transportation of Freight

The price of truck transportation of freight decreased 0.4% in June, the first monthly decline since May 2020. Since then, the indices for local and long-distance motor carrying prices are up 31.0%% and 46.5%, respectively.

Water transportation costs declined 1.5% in June after increasing 21.6% over the prior two months. Deep sea (i.e., ocean) transportation of freight prices—which are 27.2% higher than they were in March—have accounted for most of the three-month increase as the category accounts for over half of the water transportation PPI. The price of deep sea water freight has climbed 57.8% since the spring of 2020.

Not only have freight costs increased, but the prices of services to arrange freight logistics have climbed steeply as well. Over the course of 2021, the PPI for the arrangement of freight and cargo increased 95.1%. Although prices have fallen nearly 12%, YTD, they remain 57.5% above pre-pandemic levels.

Other Building Materials

The chart below shows the 12-month and year-to-date price changes of other price indices relevant to the residential construction industry.

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eyeonhousing.org

Mortgage rates average 5.70% | Cross River Real Estate

 Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey (PMMS), showing that the 30-year fixed-rate mortgage (FRM) averaged 5.70 percent.

“The rapid rise in mortgage rates has finally paused, largely due to the countervailing forces of high inflation and the increasing possibility of an economic recession,” said Sam Khater, Freddie Mac’s Chief Economist. “This pause in rate activity should help the housing market rebalance from the breakneck growth of a seller’s market to a more normal pace of home price appreciation.”

News Facts

  • 30-year fixed-rate mortgage averaged 5.70 percent with an average 0.9 point as of June 30, 2022, down from last week when it averaged 5.81 percent. A year ago at this time, the 30-year FRM averaged 2.98 percent.
  • 15-year fixed-rate mortgage averaged 4.83 percent with an average 0.9 point, down from last week when it averaged 4.92 percent. A year ago at this time, the 15-year FRM averaged 2.26 percent.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.50 percent with an average 0.3 point, up from last week when it averaged 4.41 percent. A year ago at this time, the 5-year ARM averaged 2.54 percent.

The PMMS is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20 percent down and have excellent credit. Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

Pending home sales down 13.6% | Katonah Real Estate

Pending home sales increased 0.7% on a month-over-month basis to 99.9 in May, ending a six-month streak of declines, according to the National Association of Realtors (NAR). On a year-over-year basis, pending home transactions decreased 13.6%.

“Despite the small gain in pending sales from the prior month, the housing market is clearly undergoing a transition,” says NAR chief economist Lawrence Yun. “Contract signings are down sizably from a year ago because of much higher mortgage rates.”

According to the NAR, at the median single-family home price and with a 10% down payment, the monthly mortgage payment has increased by approximately $800 since the beginning of the year as mortgage rates have increased 2.5 percentage points since the start of the 2022.

“Trying to balance the housing market by choking off demand via higher mortgage rates is damaging to consumers and the economy,” Yun says. “The better way to balance the market is through increased supply, which also helps the broader economy.”

Yun says variations in home prices and affordability contributed to regional differences in pending sales activity in May, with the largest decline in contract activity occurring in the West, where homes are the most expensive. The Pending Home Sales Index (PHSI) decreased 5% in the West in May and was down 19.8% on a year-over-year basis.

In the Northeast, pending sales increased 15.4% compared with April but decreased 11.9% compared with May 2021. The Midwest PHSI decreased 1.7% in May and 8.8% on a year-over-year basis.

The South PHSI increased 0.2% in May but decreased 13.8% compared with a year ago.

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builderonline.com/data-analysis/

Case Shiller prices up 21.2% | Bedford Hills Real Estate

Home price increases slowed ever so slightly in April, but it is the first potential sign of a cooling in prices.

Prices rose 20.4% nationally in April compared with the same month a year ago, according to the S&P CoreLogic Case-Shiller Index. In March, home prices grew 20.6%. The last slight deceleration was in November of last year.

The 10-city composite annual increase was 19.7%, up from 19.5% in March. The 20-city composite posted a 21.2% annual gain, up from 21.1% in the previous month.

In a change from the last five months, when most of the 20 cities saw month-to-month price gains, only nine cities saw prices rise faster in April than they had done in March. Cities in the South continued to see the strongest monthly gains, including Charlotte, North Carolina; Tampa, Florida; Atlanta, Dallas and Miami.

“April 2022 showed initial (although inconsistent) signs of a deceleration in the growth rate of U.S. home prices,” Craig Lazzara, managing director at S&P DJI, wrote in a release. “We continue to observe very broad strength in the housing market, as all 20 cities notched double-digit price increases for the 12 months ended in April. April’s price increase ranked in the top quintile of historical experience for every city, and in the top decile for 19 of them.”

Tampa, Miami and Phoenix continued to lead the pack with the strongest price gains. Tampa home prices were up, with a stunning 35.8% year-over-year price increase, followed by Miami, with a 33.3% increase, and Phoenix, with a 31.3% increase. Nine of the 20 cities reported higher price increases in the year ending April 2022 versus the year ending March 2022.

Cities with the smallest gains, although still in double digits, were Minneapolis, Washington and Chicago.

Not only are these price gains for April, but the index is a three-month moving average. The average rate on the 30-year fixed mortgage just crossed the 5% mark in April after rising from around 3% in January. By June it had crossed 6%.

“We noted last month that mortgage financing has become more expensive as the Federal Reserve ratchets up interest rates, a process that had only just begun when April data were gathered,” said Lazzara. “A more challenging macroeconomic environment may not support extraordinary home price growth for much longer.”

The housing market is already cooling, with slower sales and reports of price drops among some sellers. The supply of homes for sale has also increased steadily, as more listings come on the market and homes already on it sit longer. Active inventory last week was 21% higher than it was the same week one year ago, according to Realtor.com.

“For buyers and sellers, the road ahead will require more flexibility in pricing, brushing up on negotiation skills, and acknowledging that market conditions today are different than even six months ago,” said George Ratiu, senior economist at Realtor.com.

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cnbc.com/2022/6/28/

Existing home sales fall 8.6% | Bedford Real Estate

  • Existing-home sales declined for the fourth straight month to a seasonally adjusted annual rate of 5.41 million. Sales were down 3.4% from April and 8.6% from one year ago.
  • At $407,600, the median existing-home sales price exceeded $400,000 for the first time and represents a 14.8% increase from one year ago.
  • The inventory of unsold existing homes rose to 1.16 million by the end of May, or the equivalent of 2.6 months at the current monthly sales pace.

WASHINGTON (June 21, 2022) – Existing-home sales retreated for the fourth consecutive month in May, according to the National Association of Realtors®. Month-over-month sales declined in three out of four major U.S. regions, while year-over-year sales slipped in all four regions.

Total existing-home sales,1 https://www.nar.realtor/existing-home-sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 3.4% from April to a seasonally adjusted annual rate of 5.41 million in May. Year-over-year, sales receded 8.6% (5.92 million in May 2021).

“Home sales have essentially returned to the levels seen in 2019 – prior to the pandemic – after two years of gangbuster performance,” said NAR Chief Economist Lawrence Yun. “Also, the market movements of single-family and condominium sales are nearly equal, possibly implying that the preference towards suburban living over city life that had been present over the past two years is fading with a return to pre-pandemic conditions.”

Total housing inventory2 registered at the end of May was 1,160,000 units, an increase of 12.6% from April and a 4.1% decline from the previous year (1.21 million). Unsold inventory sits at a 2.6-month supply at the current sales pace, up from 2.2 months in April and 2.5 months in May 2021.

“Further sales declines should be expected in the upcoming months given housing affordability challenges from the sharp rise in mortgage rates this year,” Yun added. “Nonetheless, homes priced appropriately are selling quickly and inventory levels still need to rise substantially – almost doubling – to cool home price appreciation and provide more options for home buyers.”

The median existing-home price5 for all housing types in May was $407,600, up 14.8% from May 2021 ($355,000), as prices increased in all regions. This marks 123 consecutive months of year-over-year increases, the longest-running streak on record.

Properties typically remained on the market for 16 days in May, down from 17 days in April and 17 days in May 2021. Eighty-eight percent of homes sold in May 2022 were on the market for less than a month.

First-time buyers were responsible for 27% of sales in May, down from 28% in April and down from 31% in May 2021. NAR’s 2021 Profile of Home Buyers and Sellers – released in late 20214 – reported that the annual share of first-time buyers was 34%.

All-cash sales accounted for 25% of transactions in May, down from 26% in April and up from 23% recorded in May 2021.

Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in May, down from 17% in April and 17% in May 2021.

Distressed sales5 – foreclosures and short sales – represented less than 1% of sales in May, essentially unchanged from April 2022 and May 2021.

According to Freddie Mac, the average commitment rate(link is external) for a 30-year, conventional, fixed-rate mortgage was 5.23% in May, up from 4.98% in April. The average commitment rate across all of 2021 was 2.96%.

Realtor.com®’s Market Trends Report(link is external) in May shows that the largest year-over-year median list price growth occurred in Miami (+45.9%), Nashville (+32.5%), and Orlando (+32.4%). Austin reported the highest growth in the share of homes that had their prices reduced compared to last year (+14.7 percentage points), followed by Las Vegas (+12.3 percentage points) and Phoenix (+11.6 percentage points).

Single-family and Condo/Co-op Sales

Single-family home sales declined to a seasonally adjusted annual rate of 4.80 million in May, down 3.6% from 4.98 million in April and down 7.7% from one year ago. The median existing single-family home price was $414,200 in May, up 14.6% from May 2021.

Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 610,000 units in May, down 1.6% from April and down 15.3% from one year ago. The median existing condo price was $355,700 in May, an annual increase of 14.8%.

“Declining home purchases means more people are renting, and the resulting rent price escalation may spur more institutional investors to buy single-family homes and turn them into rental properties – placing additional financial strain on prospective first-time homebuyers,” said NAR President Leslie Rouda Smith, a Realtor® from Plano, Texas, and a broker associate at Dave Perry-Miller Real Estate in Dallas. “To counter this trend, policymakers should consider incentivizing an inventory release to the market by temporarily lowering capital gains taxes for mom-and-pop investors to sell to first-time buyers.”

Regional Breakdown

Existing-home sales in the Northeast climbed 1.5% in May to an annual rate of 680,000, falling 9.3% from May 2021. The median price in the Northeast was $409,700, a 6.7% rise from one year ago.

Existing-home sales in the Midwest dropped 5.3% from the previous month to an annual rate of 1,240,000 in May, slumping 7.5% from May 2021. The median price in the Midwest was $294,500, up 9.5% from one year before.

Existing-home sales in the South declined 2.8% in May to an annual rate of 2,410,000, down 8.4% from the previous year. The median price in the South was $375,000, a 20.6% jump from one year ago. For the ninth consecutive month, the South recorded the highest pace of price appreciation in comparison to the other three regions.

Existing-home sales in the West slid 5.3% compared to the month before to an annual rate of 1,080,000 in May, down 10.0% from this time last year. The median price in the West was $633,800, an increase of 13.3% from May 2021.

The National Association of Realtors® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.

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For local information, please contact the local association of Realtors® for data from local multiple listing services (MLS). Local MLS data is the most accurate source of sales and price information in specific areas, although there may be differences in reporting methodology.

NOTE: NAR’s Pending Home Sales Index for May is scheduled for release on June 27, and Existing-Home Sales for June will be released on July 20. Release times are 10 a.m. Eastern.


1 Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR benchmarks home sales periodically using other sources to assess overall home sales trends, including sales not reported by MLSs.

Existing-home sales, based on closings, differ from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which account for more than 90% of total home sales, are based on a much larger data sample – about 40% of multiple listing service data each month – and typically are not subject to large prior-month revisions.

The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.

2 Total inventory and month’s supply data are available back through 1999, while single-family inventory and month’s supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90% of transactions and condos were measured only on a quarterly basis).

3 The median price is where half sold for more and half sold for less; medians are more typical of market conditions than average prices, which are skewed higher by a relatively small share of upper-end transactions. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if additional data is received.

The national median condo/co-op price often is higher than the median single-family home price because condos are concentrated in higher-cost housing markets. However, in a given area, single-family homes typically sell for more than condos as seen in NAR’s quarterly metro area price reports.

4 Survey results represent owner-occupants and differ from separately reported monthly findings from NAR’s Realtors® Confidence Index, which include all types of buyers. Investors are under-represented in the annual study because survey questionnaires are mailed to the addresses of the property purchased and generally are not returned by absentee owners. Results include both new and existing homes.

5 Distressed sales (foreclosures and short sales), days on market, first-time buyers, all-cash transactions and investors are from a monthly survey for the NAR’s Realtors® Confidence Index, posted at nar.realtor.

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