WASHINGTON: Existing-home sales fell in May for the second straight month as rising home prices due to tight supply continued to constrain sales, the National Association of Realtors said Wednesday.
The realtors group also pointed a finger at rising interest rates, which are playing a role in "pinching the budgets of prospective buyers, and ultimately keeping some from reaching the market," said NAR chief economist Lawrence Yun.
Sales of single-family houses, townhouses, condos and co-ops dropped 0.4 percent in May to an annual rate of 5.43 million, below analyst forecasts.
Sales have fallen 3.0 percent from a year ago and have now dropped year-over-year for three straight months, NAR said.
Median home prices rose to $264,800, an all-time high.
Total inventory climbed 2.8 percent to 1.85 million, but is still 6.1 percent below the year-ago level.
"Inventory coming onto the market during this year's spring buying season -- as evidenced again by last month's weak reading -- was not even close to being enough to satisfy demand," Yun said.
"That is why home prices keep outpacing incomes and listings are going under contract in less than a month -- and much faster -- in many parts of the country."
"The bottom line here is that single-family sales have dipped to a four-month low, and the trend has been flat, net, since the middle of last year, though the hurricanes and bouts of severe winter weather have made the monthly data very noisy," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.
"Looking ahead, the mortgage applications numbers suggests sales will be flat, at best, over the summer, but with inventory still falling on a year over year basis, prices will continue to rise.
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