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Sales of previously owned homes saw a modest bump in July, breathing life into a housing market that has struggled under the weight of affordability challenges.
Existing-homes sales, which account for the vast majority of residential real estate transactions, increased 2% last month from June seasonally adjusted annual rate of 4.01 million, the National Association of Realtors reported on Thursday. The July figure was up 0.8% from a year earlier.
The median sales price of existing-homes was little changed from last year at $422,400, up just 0.2% on an annual basis.
“Near-zero growth in home prices suggests that roughly half the country is experiencing price reductions,” says NAR Chief Economist Lawrence Yun. “Wage growth is now comfortably outpacing home price growth, and buyers have more choices.”
While national sales prices were up 0.2% in July, there was significant regional divergence. Home prices fell 4% annually in the West and dropped 0.6% in the South, while prices rose 3.9% in the Midwest and 0.8% in the Northeast.
“In a housing market where the negotiating power among buyers and sellers is in flux, home pricing and sales trends have diverged regionally in meaningful ways,” says Realtor.com Chief Economist Danielle Hale. “Home buyers and sellers will want to consider how closely their local housing market mirrors national trends, and make sure they’re setting expectations based on local trends.”
Recent housing data from Realtor.com show that while home prices have softened in 33 of the 50 largest markets in the last year, the price trends compared to three years ago has a much wider range.
Markets like Miami and Austin have seen double-digit declines in asking prices, while markets like Milwaukee, Providence, Cleveland and others have seen double-digit gains.
Cash buyers make gains while first-time buyers lag
The July sales data showed that cash buyers made up 31% of all transactions for existing homes last month, up from 27% a year ago and an unusually high share.
First-time buyers, meanwhile, accounted for 28% of sales, down from 30% in June and 29% in July 2024.
NAR economist Yun says that record highs for the stock market combined with huge gains in housing wealth are allowing more buyers to pay with cash and avoid elevated mortgage rates.
“People with exposure to stock market wealth, exposure to housing wealth—they’re in a very comfortable situation to make those cash purchases,” Yun said on a call with reporters.
Developing story, check back for updates.