Home sales in August fell more than analysts anticipated, marking a 2.5% drop from July and a 4.2% decline compared to August 2023. The National Association of Realtors (NAR) reported a seasonally adjusted annualized rate of 3.86 million units sold, marking the third consecutive month that sales remained below 4 million.
The dip in sales comes despite improving mortgage rates, which fell from over 7% in mid-June to around 6.7% by the end of July. Lawrence Yun, NAR’s chief economist, noted that while August’s numbers were disappointing, the combination of falling mortgage rates and rising inventory could pave the way for a stronger housing market in the coming months.
Inventory saw a slight improvement, with 1.35 million units available for sale at the end of August, up 0.7% from July and 22.7% year-over-year. However, the market remains tight, with just a 4.2-month supply, below the six months considered balanced between buyers and sellers. In markets with particularly limited supply, like those in the Northeast, sellers still hold an advantage.