As the market continues to be hounded with a dearth in real estate for sale, especially for cheaper housing units, U.S. property sales sputtered more than estimated in September.
Sales of previously owned homes declined for the month to the lowest level in three months as higher prices limited the recent progress in residential properties that have been supported by low mortgage rates and consistent wage gains.
The National Association of Realtors on Tuesday disclosed that existing home sales fell 2.3 percent for the month to a seasonally adjusted yearly level of 5.39 million units, reversing two consecutive months of increases. The selling rate for the previous month has been updated upwards to 5.51 million units.
Existing home prices were projected by economists polled by Reuters to decrease by 0.8 percent to 5.44 million units.
On two occasions this year, the Federal Reserve has trimmed down its interest rates, improving the property market and decreasing rates in the mortgage. As policymakers meet next week, investors estimate another decline in interest rates.
Based on the latest figures by mortgage finance firm Freddie Mac, the 30-year fixed mortgage rate has been reduced over 125 basis points since last November's peak to an average of almost 4 percent.
For much of this year, though, home sales have been seesawed as a persistent shortage of properties on the market has inflated prices, making them cheap for many prospective buyers. The lack of land and manpower has also crimped demand.
Last month, there were 1.83 million homes on the market, down 2.7 percent from a year earlier. It was the fourth month of year-on-year decreases in stocks.
Last week's data showed homebuilding tumbled from a September record of more than 12 years, but home-building for a single-family rose for a fourth straight month.
The average current house price rose 5.9 percent from a year earlier to September's $272,100, the fastest cost increase since January 2018. It was the year-on-year cost rises for the 91st straight month.
"We had assumed that price increases would equal wages... but that's not the case," Lawrence Yun, NAR's chief economist, pointed out.
Existing home sales rose from a year earlier by 3.9 million, the NAR reported. Last month, sales dropped across the four regions of the country. In the Midwest, they fell 3.1 percent and in the Northeast, 2.8 percent. They fell in the South by 2.1 percent and advanced in the North by 0.9 percent.
It would take more than four months to clear the market's current inventory in terms of last month's selling rate. Analysts consider a six to seven-month supply as a stable supply-demand ratio.
