LOS ANGELES — Sales of previously occupied homes in the United States ended a four-month decline in July as lower mortgage rates and an increase in properties on the market encouraged home buyers.
Sales of existing homes rose 1.3% last month from June to a seasonally adjusted annual rate of 3.95 million, the National Association of Realtors said Thursday.
Sales were down 2.5% compared to July last year. The latest home sales came in slightly higher than the 3.92 million economists expected, according to FactSet.
House prices rose on an annual basis for the 13th month in a row. The national median sales price rose 4.2% from a year earlier to $422,600.
“Despite the modest gain, home sales remain sluggish,” said Lawrence Yun, NAR’s chief economist. “But consumers are definitely seeing more choices, and affordability is improving because of lower interest rates.”
The supply of properties on the market continued to increase last month.
All told, there were about 1.33 million unsold homes at the end of July, up 0.8% from June and 19.8% from July last year, the NAR said.
That translates to a 4-month supply at the current sales pace, up from a 3.3-month pace at the end of July last year. Traditionally, a 5- to 6-month delivery is considered a balanced market between buyers and sellers.
The U.S. housing market has been in a deep sales slump dating back to 2022, when mortgage rates began to climb from pandemic-era lows. Existing home sales fell to a nearly 30-year low last year as the average rate on a 30-year mortgage rose to a 23-year high of 7.79%, according to mortgage buyer Freddie Mac.
Mortgage rates have mostly fallen in recent weeks, with the average rate on a 30-year home loan at about 6.5%, the lowest level in more than a year. Signs of slowing inflation and a cooling labor market have raised expectations that the Federal Reserve will cut its benchmark interest rate next month for the first time in four years.
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