May Existing Home Sales Rise Slightly Amidst Increased Supply and Record Prices

May Existing Home Sales Overview

• 📈 Existing home sales in May saw a slight increase of 0.8% from April, reaching a seasonally adjusted annualized rate of 4.03 million units.
• 📉 This figure was contrary to street estimates, which predicted a slight decline, and represented a 0.7% decrease compared to May of the previous year.
• ⚠️ The sales pace was the slowest for May since 2009, reflecting contracts likely signed in March and April when mortgage rates were rising.

Factors Influencing Sales and Supply

• 🏠 The increase in sales was likely driven by a significant jump in the supply of homes for sale, which rose over 20% year-over-year to 1.54 million units.
• 📊 At the current sales pace, this represents a 4.6-month supply, which is still considered historically low, contributing to ongoing price pressures.

Home Prices and Buyer Demographics

• 💰 The median price of an existing home sold in May reached a record high for the month at $422,800, up 1.3% year-over-year.
• 📉 However, this annual gain was the smallest recorded since June 2023.
• ⏳ Homes are taking longer to sell, with an average of 27 days on the market compared to 24 days a year ago.
• 🧑‍🤝‍🧑 First-time buyers accounted for only 30% of all buyers, a decrease from 31% last year.
• 💸 All-cash transactions represented 27% of all sales, an increase from the previous year.