Existing Home Sales Post Decline

Prices still increasing

Sales of existing homes in the U.S. fell in May to a 6.67 million annual rate, a 1.2% decline from April’s revised 6.75 million annual pace, the National Association of Realtors said Tuesday. April resales were originally seen at 6.76 million.

Meanwhile, an improved outlook for the economy’s performance over coming months helped lift U.S. consumers’ mood in June, amid a mixed outlook for the jobs market.

NAR chief economist David Lereah said rising interest rates are affecting home sales. "Although mortgage interest rates remain historically low, the uptrend in interest rates this year is affecting those buyers who are at the margins of affordability," Mr. Lereah said.

The level of resales in May was above Wall Street expectations. Analysts predicted a 6.64 million rate of sales of previously owned homes.

The average 30-year mortgage rate was 6.6% in May, up from 6.51% in April, according to Freddie Mac. The median home price increased to $230,000, compared with a revised $222,000 in April.

The inventory of homes on the market increased to 6.5 months, from April’s revised 6.1 months, NAR said. Existing home sales were mixed in the four regions of the U.S. Demand fell 3.8% in the Midwest and 4.2% in the Northeast, while it rose 0.7% in the West and 0.4% in the South.