US housing prices break records: average house price over 400 thousand dollars - CNBC
Kyiv • UNN
In May, US home sales rose by 0.8% despite high mortgage rates. The average house price reached a record $422,800, exceeding last year's figure by 1.3%.
US home sales rose slightly in May, but despite analysts' expectations of a decline in value, the market continues to surprise with high prices. The average cost of a house reached over $400,000. This is reported by UNN with reference to CNBC.
Details
In May, as indicated, the US housing market showed a slight increase in sales, but real estate prices reached a new record.
According to the National Association of Realtors, the number of existing home sales rose by 0.8% compared to April, reaching 4.03 million units on an annualized basis. This result exceeded analysts' forecasts, who expected a 1% decline. However, compared to May last year, sales remain 0.7% lower.
The most significant growth was observed in the Northeast of the country, where sales volumes increased by 4.2%. Positive dynamics were also recorded in the Midwest and South. At the same time, in the Western region, despite traditionally high prices, the number of transactions decreased, and prices fell by 5.4%. It is important to note that these data are based on concluded agreements that were most likely signed in March-April, when mortgage rates remained stable. However, in April, they rose sharply, exceeding 7%.
NAR Chief Economist Lawrence Yun explained that "relatively low sales are largely due to persistently high mortgage rates." He added that if rates fall in the second half of the year, demand for housing can be expected to increase due to rising incomes, stable capital accumulation, and a high number of jobs.
At the end of May, 1.54 million homes were available on the market - 20% more than last year. Despite this, prices continue to rise.
"The median price of a home sold in May was $422,800, up 1.3% from May 2024 - the highest for that month on record," the publication states.
Demand still exceeds supply. Approximately 28% of homes were sold at prices higher than asked.
A small increase is observed in the price segment from $750,000 to $1 million, while in the segment over $1 million, a decline is observed.
Lawrence Yun noted that "the upper-end market does not show any difference compared to other price categories," adding that this could be due to stock market volatility after news of tariffs in April.
The time to sell a home increased to 27 days from 24 days a year ago. The share of first-time homebuyers decreased to 30%, and the number of cash transactions increased to 27% - more than last year.