- August’s existing-home sales figures remained flat since July at a seasonally adjusted annual rates of 5.34 million units.
- Demand continued to sag as home buyers can no longer withstand the headwinds of abysmally low inventory and steady price appreciation. Rising mortgage rates this year have also cooled demand and contributed to declining affordability.
- Buyers are pulling back as they sense home prices are nearing an apex, but sellers are still in the driver’s seat.
Existing-home sales were unchanged in August, remaining at a seasonally adjusted annual rate of 5.34 million units. This represents a flattening after four consecutive months of declines with existing-home sales staying at their lowest levels since February 2016. Pent up demand and strong economic conditions for consumers are no longer enough to drive existing-home sales up month-over-month. The flattening of existing-home sales is a barometer of overall softening of the housing market and an indication that prospective home buyers can no longer gird against prevailing headwinds. Existing-home sales on a per household basis held steady at 80.0% of pre-recession levels, the lowest it has been since November 2015.
The headwinds of historically low inventory, mortgage rates hovering just below seven-year highs and strong price growth dampened demand. Existing home sales accounted for 24.5% of inventory sold—the 3rd consecutive month it has fallen below its pre-recession peak.
