Home prices in the United States soared again with the ongoing strong demand, marking a record high in June. However, as supply surged, the countrywide house-purchasing mania cooled slightly.
According to the National Association of Realtors on Thursday, existing-home sales climbed up 1.4% last month from May to a seasonally adjusted yearly rate of 5.86 million. In addition, the sales of houses inched relatively higher in June while the inventory of available homes bolstered.
However, home prices remained on the rowdy side. Nevertheless, steady low inventory has made prices climb up in the course of 2020.
Median price at $363,300 in June
An existing home’s median price in the U.S. has hit a new record high at $363,300 as of June. According to the latest data from the NAR, this figure is up 23.4% from a year ago and breaks the previous record set the month prior.
In addition, the sales of existing houses also climbed up in June. Such sales ricocheted following four successive months of declines. This was while more inventory was made available in the market for enthusiastic purchasers, reported Fox Business.
Small increase in housing supply
NAR chief economist Lawrence Yun stated that a minimum spike in the housing supply helped increase purchases for the first time since February. However, this merely made a small impact in mitigating the appalling price hikes that stifled early 2021 sales.
Yun remarked that supply has humbly improved in the past few months, courtesy of already present homeowners listing their houses and more housing starts. These factors have bolstered sales, reported The Hill.
Remarking on his outlook on home prices in the future, Yun remained optimistic. He explained that home prices are generally safe from price declines, yet prices are expected more slowly by year-end.
Yun furthers that home prices would increase as income grows under ideal conditions – and this is the scenario that is “likely to happen in 2022” with added home listings and a rise in construction.
Sales before COVID-19
Still, house sales at their seasonally adjusted yearly rate are just under the 5.9 million annual rate economists anticipate.
The pace of house sales in May 2021 outperformed the 5.7 million yearly rate in February last year. However, this was before the advent of the novel coronavirus, which resulted in a spring decline in 2020 sales, reported Los Angeles Times.
Sales at the end of June
There were 1.25 million homes for sale at the conclusion of June 2021. This was down 18.8% from 2020 and up 3.3% from the inventory of May 2021.
That is equivalent to a 2.6-month supply. An equitable market between sellers and purchasers regularly necessitates a 6-month supply.