US homes sales drop as supply dwindles

Existing home sales in the U.S. took a dive in June, as demand outpaced a serious shortage in supply.

Sales of previously owned homes declined 1.8 percent last month from May, falling to a seasonally adjusted annual rate of 5.52 million, according to the National Association of Realtors. Meanwhile, sale prices jumped to $263,800, a 6.5 percent increase year-over-year, the Wall Street Journal reported.

Since March, when sales hit the highest level since 2007, sales of existing homes have remained pretty stagnant. At the end of last month, a 4.3-month supply of homes was on the market. At the same time last year, there was a 4.6-month supply available.

“The demand for buying a home is as strong as it has been since before the Great Recession. Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines, NAR Chief Economist Lawrence Yun told the Journal.

The NAR study found that foreign buyers were responsible for some of the uptick in demand. Foreign buyers and recent immigrants bought $153 billion worth of residential property in the year that ended in March, up close to 50 percent. Canadians were responsible for $19 billion of that total, the report found. [WSJ] — Kathryn Brenzel