National Association of Realtors economist Lawrence Yun

WASHINGTON, DC—While sales of new homes in July surpassed all expectations, the volume of trades for existing homes went in the opposite direction. The National Association of Realtors said Wednesday that existing-home sales declined year over year last month for the first time since this past November, with volume of for-sale apartments taking an especially steep fall.

“Severely restrained inventory and the tightening grip it's putting on affordability is the primary culprit for the considerable sales slump throughout much of the country last month,” says Lawrence Yun, chief economist at NAR. “Realtors are reporting diminished buyer traffic because of the scarce number of affordable homes on the market, and the lack of supply is stifling the efforts of many prospective buyers attempting to purchase while mortgage rates hover at historical lows.”

Single-family home sales decreased 2% from the previous month to a seasonally adjusted annual rate of 4.82 million in July from 4.92 million in June. They're now 0.8% under the 4.86 million pace of the year-ago period.

Sales of existing condominium and co-op sales dropped 12.3% to a seasonally adjusted annual rate of 570,000 units in July from 650,000 in June, and are now 8.1% below July 2015's 620,000 units. “With new condo construction barely budging and currently making up only a small sliver of multifamily construction, sales suffered last month as condo buyers faced even stiffer supply constraints than those looking to purchase a single-family home,” says Yun.

Conversely, the price of an existing home continued to increase, with July's 5.3% increase to $244,100 marking the 53d consecutive month of Y-O-Y gains. The median existing single-family home price was $246,000 in July, up 5.4% percent from a year ago. The median existing condo price was $228,400 in July, which is 4.1% higher.

The share of first-time buyers was 32% in July, below the June share of 33% but up from 28% a year ago. First-time buyers represented 30% of sales in all of '15, according to NAR.

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The share of first-time buyers was 32% in July, below the June share of 33% but up from 28% a year ago. First-time buyers represented 30% of sales in all of '15, according to NAR.

Instant Insights /

Existing-Home Sales Falter in July

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