U.S. existing-home sales fall for sixth straight month amid cooling market

Existing-home sales in the United States declined for the sixth straight month in July, the National Association of Realtors (NAR) reported Thursday.

Existing-home sales slipped 5.9 percent from June to a seasonally adjusted annual rate of 4.81 million in July. Year-over-year, sales plunged 20.2 percent in July.

"The ongoing sales decline reflects the impact of the mortgage rate peak of 6 percent in early June," said NAR Chief Economist Lawrence Yun.

Government data released Tuesday showed that U.S. housing starts in July plunged by 9.6 percent, also indicating a cooling housing market amid rising rates and elevated inflation.

Housing starts declined to a seasonally adjusted annual rate of 1.446 million in July, which is 8.1 percent below the July 2021 rate, according to a report released by the U.S. Census Bureau, part of the Commerce Department.

"Housing demand continues to weaken on higher interest rates while on the supply side builders continue to grapple with higher construction costs," Jerry Konter, chairman of the National Association of Home Builders (NAHB), said in a statement.

"Builders are reporting weakening traffic as housing affordability declines," said Konter.

"We're witnessing a housing recession in terms of declining home sales and home building," Yun said.

Yun, however, noted that it's not a recession in home prices, as inventory remains tight and prices continue to rise nationally with nearly 40 percent of homes still commanding the full list price.

The median existing-home price for all housing types in July was 403,800 dollars up 10.8 percent from July 2021, as prices increased in all regions, the report showed.

Yun said home sales may soon "stabilize" since mortgage rates have fallen to near 5 percent, thereby giving an additional boost of purchasing power to home buyers.