National Home Sales Rise While Prices Fall...
Existing home sales rose in May, as increasingly affordable home prices and a first-time tax credit attracted hesitant buyers.
The National Association of Realtors reported that existing home sales ticked up 2.4% last month to a seasonally adjusted annual rate of 4.77 million units compared to the downwardly-revised rate of 4.66 million in April.
The sales missed expert forecasts of 4.82 million annual units, according to a consensus estimate of analysts compiled by Briefing.com, and are off 3.6% from the 4.95 million-unit pace 12 months ago.
The median price of homes sold in May was $173,000, a 16.8% year-over-year drop. Low mortgage rates, affordable home prices and the $8,000 first-time homebuyer tax credit continue to draw buyers into the market.
The slight sales increase helped reduced some of the supply of homes on the market. Total housing inventory fell 3.5% to 3.8 million existing homes for sale. That's a 9.6-month supply, down from a 10.1-month supply in April.
The sales increase is less than expected because poor appraisals are stalling transactions and some contracts are falling through from faulty valuations that keep buyers from getting a loan.
A report earlier this month showed the number of home sale contracts signed in April far exceeded forecasts. Pending home sales are a forward-looking indicator since many of the contracts take weeks or months to become completed deals.