Home sales fell for the sixth month in a row, but prices kept rising

Nevertheless, home prices continued to climb by double-digit percentages during the month. The median home price was $403,800 in July, up 10.8% from a year ago but slightly lower than the record high reached last month, according to a report from the National Association of Realtors. The price increase marks more than a decade of year-over-year monthly gains.

Meanwhile, sales of existing homes -- which include single-family homes, townhomes, condominiums and co-ops -- were down 20.2% from a year ago and down 5.9% from June.

Sales in July were at their weakest level since May 2020, which was an anomaly because that was amidst the pandemic lockdown. Setting that aside, it was the weakest market since November 2015.

"The ongoing sales decline reflects the impact of the mortgage rate peak of 6% in early June," said Lawrence Yun, NAR's chief economist. "Home sales may soon stabilize since mortgage rates have fallen to near 5%, thereby giving an additional boost of purchasing power to home buyers."

One reason home prices have climbed so high is a lack of supply. The number of homes on the market had been steadily dropping for three years. But July saw a monthly increase. The number of homes available for sale at the end of July was up 4.8% from June and about the same as a year ago.

"We're witnessing a housing recession in terms of declining home sales and home building," Yun said. "However, it's not a recession in home prices. Inventory remains tight and prices continue to rise nationally with nearly 40% of homes still commanding the full list price."

This is a developing story. It will be updated.

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