Although home sales have slowed to their lowest rate since June 2020, when 4.77 million homes were sold throughout the year, the skyrocketing cost of homeownership has not abated.
Given how difficult it is for the majority of people to purchase a home in Biden's economy, home prices are breaking new records even as real estate sales slow. The median sale price of an existing home in May was $407,600, according to the National Association of Realtors (NAR), which released the statistics on Tuesday.
According to the NAR, that represents an increase of approximately 15% from the previous year and an all-time high dating back to 1999.
Meanwhile, existing home sales decreased for the fourth consecutive month as buyers were squeezed by rising mortgage rates and record-high home prices.
According to the NAR, sales decreased by 3.4 percent from April to a seasonally adjusted annual rate of 5.41 million last month.
After two years of phenomenal performance, “Home sales have essentially returned to the levels seen in 2019 – prior to the pandemic – after two years of gangbuster performance,” NAR Chief Economist Lawrence Yun stated in a statement.
The biggest weekly increase in 35 years occurred last week in average long-term mortgage rates in the United States. To battle the worst inflation in forty years, the Federal Reserve increased its benchmark interest rate by 0.75%.
Last week, the average interest rate for a 30-year mortgage increased to 5.78 percent, the highest level since November 2008.
Some experts have revised their predictions for the housing market in 2022 as a result of the present downturn in home sales. According to Realtor.com, US home sales will be down 6.7% from the previous year.
People working in the industry are also feeling the effects of the market cooling. Two tech-driven real estate companies, Redfin and Compass, have both announced large layoffs as a result of declining revenues and market values.
Due to significantly higher home financing costs than they were a year ago, the housing market is slowing down. The decline comes after a nationwide rapid increase in mortgage rates.
The preceding is a summary of an article that originally appeared on The Gateway Pundit.