Posted 2 days ago
The median price for an existing home sold in May rose to a record high of $407,600 in May, the National Association of Realtors said Tuesday.
This is the first time the median home price has exceeded $400,000. Compared with a year ago, the median selling price is up 14.8 percent.
The median existing single-family home price was $414,200 in May, up 14.6 percent from May 2021.
Prices have continued to climb as the nation is gripped by inflation and a shortage of homes for sale. Rising mortgage rates, which have climbed sharply this year as the Fed hikes interest rates to fight inflation, have dealt a severe blow to housing affordability.
First-time buyers were responsible for 27 percent of sales in May, down from 28 percent in April and down from 31 percent in May 2021.
Sales of existing homes fell 3.4 percent to a seasonally adjusted annual rate of 5.41 million in May, according to the N. A.R. Compared with a year ago, sales are down 8.6 percent.
“Declining home purchases means more people are renting, and the resulting rent price escalation may spur more institutional investors to buy single-family homes and turn them into rental properties – placing additional financial strain on prospective first-time homebuyers,” said NAR President Leslie Rouda Smith, a Realtor® from Plano, Texas, and a broker associate at Dave Perry-Miller Real Estate in Dallas. “To counter this trend, policymakers should consider incentivizing an inventory release to the market by temporarily lowering capital gains taxes for mom-and-pop investors to sell to first-time buyers.”
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