The sales of US homes continuously decreased consecutively for four months. The decrease is caused by the increased prices of the houses caused by the rise of the cost of materials for the build, shortage of land to be used and unavailability of workers.
Existing home sales decreased by 0.7 percent to an adjusted annual rate of 5,34 million units in July according to the National Association of Realtors on Wednesday. It is the longest monthly decline rate since 2013.
Reuters poll with Economists predicted that existing home sales would gain by 0.6 percent to a rate of 5.40 million units in July. The housing sales dropped within the Northeast, South, and Midwest and it increased in the West.
The housing sale decreased by 8.3 percent in the Northeast, the decrease is 1.6 percent in the Midwest and 0.4 percent in the south. The west's housing sales increased by 4.4 percent.
Besides, the NAR's statement said that the inventory of house sales shows stabilizing signs last month, sales have been foiled by the high shortages of homes on the market for months. the sales of existing homes make up the 90 percent of the total US homes sales and its decrease affected the later by 1.5 percent.
In the month of July, there were about1.92 million homes on the US market which is equal to last year's. According to Lawrence Yun, the NAR's chief economist, the month of July is the first month in which the inventory did not fall on a year-on-year basis.
Yun said that the existing home sales decline last night is the Northeast's slowest pace since February 2016 at 5.21 million. He added that the prospected buyers are either out-priced or have postponed their purchase until they have found homes that are in their price range in the market.
The lack of supply of housing construction materials is largely accounted for the significant decrease in home sales. It is feared that the increased house price and the rising mortgage rates will slow down the demand.
At the rate of sales in the month of July, the current inventory needs at least 4.3 months to be exhausted. It is believed that a healthy and balanced supply and demand needs at least six to seven months of housing supply.
The price for a median house in July increased to around $269.600, a 4.5 percent increase from its cost a year ago.
