Home prices went up again in May. No, we aren’t surprised either.
According to data released by the National Association of REALTORS® (NAR), the median existing home price across all housing types reached a record high of $350,300 in May. This was an increase of a whopping 23.6% from the same time in 2020.
Overall, home prices rose across the entire country for the 111th consecutive month, dating back to March 2012.
Sales of existing homes dropped for the fourth straight month, down 0.9 percent from April 2021. Still, existing home sales remain up 44.6% year over year.
“Home sales fell moderately in May and are now approaching pre-pandemic activity,” Lawrence Yun, Chief Economist for NAR, said in a statement. “Lack of inventory continues to be the overwhelming factor holding back home sales, but falling affordability is simply squeezing some first-time buyers out of the market.
“The market’s outlook, however, is encouraging. Supply is expected to improve, which will give buyers more options and help tamp down record-high asking prices for existing homes.”
That increase in supply has already started to show. The total inventory, according to NAR, was 1.23 million units available, an increase of 7% from April, but still significantly less (20.6%) from May 2020.
“Lack of inventory continues to be the overwhelming factor holding back home sales, but falling affordability is simply squeezing some first-time buyers out of the market.”
While the overall supply of homes increased slightly from 2.4 months supply to 2.5 months from April, it is still dangerously low and pales in comparison to the 4.6 months supply from a year earlier.
Sales are happening fast and furious. NAR reported almost 90 percent of properties sold in May spent less than one month on the market. The average was 17 days, same as it was in April, but remains much more rapid than a year ago when the average was 26 days on the market.
Single family home sales also dipped by 1% from April, but the rate of those sales is still robust, clocking in at a 39.2% increase from the same time a year ago. The median existing single family home price increased again to $356,600, a 24.4% increase from last May.
There was no change in existing co-op and condo sales from April to May, but the adjusted annual rate of 720,000 units still marks a 100% increase from the same time in 2020. The median existing condo price is $306,000, a 21.5% increase from May 2020.
“NAR continues its advocacy efforts to find new, creative and effective ways to increase housing construction and supply,” NAR President Charlie Oppler said in the report. “The right policies will provide huge benefits to our nation’s economy, and our work to close this gap will be particularly impactful for lower-income households, households of color and first-time buyers.”
About the American Property Owners Alliance
The American Property Owners Alliance (The Alliance) is a nonpartisan, non-profit organization created to protect and support property owners and pave the way for future property owners. Our mission is to educate property owners about federal issues, laws and policies; to advocate for owners’ rights and interests; and to mobilize, when necessary, to secure those rights and interests.
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