US home sales fall for seventh straight month in August

US home sales fall for seventh straight month in August

US existing home sales are dropping with loan costs soaring
US existing home sales are dropping with loan costs soaring. Photo: Stefani Reynolds / AFP/File
Source: AFP

PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find “Recommended for you” block on the home page and enjoy!

Existing home sales slipped in August to the lowest in two years, marking a seventh straight monthly declines, according to industry data released Wednesday showing the continued slowing in the US housing as mortgage rates surge.

Sales of all types of homes and condos fell 0.4 percent from July even while prices eased in the month, the National Association of Realtors (NAR) said.

The report comes on the same day the Federal Reserve was poised to deliver another big increase in the key interest rates, a move that will boost borrowing costs with further repercussions for the critical housing market.

"The housing sector is the most sensitive to and experiences the most immediate impacts from the Federal Reserve's interest rate policy changes," said NAR chief economist Lawrence Yun. "The softness in home sales reflects this year's escalating mortgage rates."

Read also

US Fed opens policy meeting with steep rate hike on the table

The median home price fell for the second month in a row to $389,500, coming down from a record-high $413,800 in June, the report said.

The housing market soared during the pandemic as Americans, flush with savings, took advantage of bargain mortgage rates to snap up homes. But as the Federal Reserve has raised interest rates aggressively to combat scorching inflation, sales have taken a hit.

PAY ATTENTION: Click “See First” under the “Following” tab to see YEN.com.gh News on your News Feed!

Existing home sales dropped 19.9 percent from the August 2021 level, with the most drastic declines occurring in the lowest price homes, according to NAR. The median price was still 7.7 percent above the year-ago figure.

The sales pace last month slowed to an annual rate of 4.80 million, seasonally adjusted, better analysts forecast but still the lowest since May 2020.

Economists warn that further slowing is likely.

Read also

Steep Fed rate hike seen as certainty after ugly inflation data

Last month's "marginal decline in sales does not mean that the floor has been reached. Sales lag mortgage applications, which continue to fall, pointing to further significant declines," said Ian Shepherdson of Pantheon Macroeconomics.

Mortgages costs have continued to escalate: The 30-year fixed rate jumped to 6.25 percent last week according to the Mortgage Bankers Association, the highest rate since October 2008.

Existing home sales make up 90 percent of the US real estate market.

Sales last month varied by region, with the Northeast and West recording increases, while the Midwest dropped and the South unchanged.

New feature: Сheck out news that is picked for YOU ➡️ find “Recommended for you” block on the home page and enjoy!

Source: AFP

Authors:
AFP avatar

AFP AFP text, photo, graphic, audio or video material shall not be published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP news material may not be stored in whole or in part in a computer or otherwise except for personal and non-commercial use. AFP will not be held liable for any delays, inaccuracies, errors or omissions in any AFP news material or in transmission or delivery of all or any part thereof or for any damages whatsoever. As a newswire service, AFP does not obtain releases from subjects, individuals, groups or entities contained in its photographs, videos, graphics or quoted in its texts. Further, no clearance is obtained from the owners of any trademarks or copyrighted materials whose marks and materials are included in AFP material. Therefore you will be solely responsible for obtaining any and all necessary releases from whatever individuals and/or entities necessary for any uses of AFP material.