Sales of existing homes south of the border continue to be constrained by low inventory and the cost of mortgages as both prices and interest rates increase.

The National Association of Realtors says that the Northeast and Midwest posted sales gains in June but these were offset by decline in the West and South.

Overall, existing home sales across the US slipped 0.6% to a seasonally adjusted annual rate of 5.38 million homes from a downwardly-revised 5.41 million in May.

“There continues to be a mismatch since the spring between the growing level of homebuyer demand in most of the country in relation to the actual pace of home sales, which are declining,” said NAR chief economict Lawrence Yun. “The root cause is without a doubt the severe housing shortage that is not releasing its grip on the nation’s housing market. What is for sale in most areas is going under contract very fast and in many cases, has multiple offers. This dynamic is keeping home price growth elevated, pricing out would-be buyers and ultimately slowing sales.”

Record median price
The short supply amid high demand meant the median price of an existing US home hit a new high in June after rising 5.2% year-over-year to $276,900. It was the 76th straight month of year-over-year gains.

Total inventory did increase, up 4.3% in the month and 0.5% year-over-year, the first annual increase since June 2015. But the 1.95 million homes available is just 4.3 months of supply and that just isn’t enough.

“It’s important to note that despite the modest year-over-year rise in inventory, the current level is far from what’s needed to satisfy demand levels,” added Yun. “Furthermore, it remains to be seen if this modest increase will stick, given the fact that the robust economy is bringing more interested buyers into the market, and new home construction is failing to keep up.”

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