The housing disaster keeps happening. The number of existing-home sales for April was 5.41 million, according to the National Association of Realtors (NAR), which decreased 8.6% from last year and 3.4% from the previous month. However, the savagely unhealthy data point showed that housing values had increased by 14.8%.
Now that July is almost here, we can confidently assert that the premise that if mortgage rates hit 4%, American homeowners would panic, sell in droves and drive total inventory up to millions of units; has not come true. That was always a horrible premise, in all honesty.
On the other hand, the worst-case scenario has come true, which is unfortunate for everyone. Since 2020, the total housing supply has decreased to historically low levels. Because this occurred between 2020 and 2024, forced bidding resulted in prices that were considered beyond the 23% estimate for home price rise over five years in just two years.
The median price of an existing home across all property types in May was $407,600, up 14.8% from May 2021 ($355,000), as prices rose. This represents the longest-ever string of 123 months with year-over-year growth. Housing demand has been declining steadily since March of this year, but inventory is still below the levels of 2010, 2013, 2016, and 2019, which is a nightmare. People don’t sell their homes to become homeless because housing is shelter; it’s where they live. So naturally, you’re also a home buyer while attempting to sell your house.
According to the NAR Research, the total number of housing units registered at the end of May was 1.16 units, up 12.6 percent from April but down 4.1% from May 2021. At the current sales rate, unsold inventory has a 2.6-month supply, up from 2.2 months in April and 2.5 months in May 2021.
To read more on the housing market and the impending effects on lenders and loan servicers, click here.