Not only did builder confidence recently slip, as reported by the most recent NAHB/Wells Fargo HMI, but now real estate agents are following suit. The National Association of Realtors (NAR) reports that realtor confidence has weakened as existing-home sales declined slightly in May. The change parallels an increase in median sales price to a record high. Per the association, sales slid month-over-month in the South but were unchanged in the Northeast, Midwest and West. Year-over-year, sales rose in the Midwest but receded in the other three regions.

Total existing-home sales, including completed transactions among single-family homes, townhomes, condominiums and co-ops, retreated 0.7% from April to a seasonally adjusted annual rate of 4.11 million in May, the report states. Year-over-year, sales waned 2.8% (down from 4.23 million in May 2023).

“Eventually, more inventory will help boost home sales and tame home price gains in the upcoming months,” said NAR chief economist Lawrence Yun. “Increased housing supply spells good news for consumers who want to see more properties before making purchasing decisions.”

Total housing inventory registered at the end of May was 1.28 million units, up 6.7% from April and 18.5% from a year ago (1.08 million). Unsold inventory sits at a 3.7-month supply at the current sales pace, up from 3.5 months in April and 3.1 months in May 2023.

The median existing-home price for all housing types in May was $419,300, the highest price ever recorded and an increase of 5.8% from a year ago ($396,500). All four U.S. regions registered price gains.

“Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” Yun added. “The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning.”

The NAR reports that the monthly REALTORS® Confidence Index currently shows properties typically remained on the market for 24 days in May, down from 26 days in April but up from 18 days in May 2023. First-time buyers were responsible for 31% of sales in May, down from 33% in April but up from 28% in May 2023. NAR’s 2023 Profile of Home Buyers and Sellers, released in November 2023, found that the annual share of first-time buyers was 32%.

Distressed sales, comprising foreclosures and short sales, represented 2% of sales in May, unchanged from last month and the previous year.

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