High home prices and climbing mortgage rates continue to hamper affordability, pushing prospective buyers’ monthly payments to their highest level on record, according to a new report.
Home prices posted their largest increase since December in the four-week period ending July 19, rising by 2.1 percent, the report from real estate brokerage Redfin showed.
The second straight price jump in the last five months moved up the sale price of a typical home to $382,500.
Rising prices, combined with stubborn mortgage rates that are nearing 7 percent, have pushed monthly payments for the typical home to a record high at $2,656.
Sales prices increased the most in Milwaukee, where their price in the four-week period ending June 16 rose by 12.2 percent from a year ago.
Redfin’s data shows prices falling in 20 metros tracked, including the pandemic-era boomtown Austin, Texas, over the same period.
Recent price growth is due largely to a dearth of existing inventory available in the market. Data released on Thursday by the National Association of Realtors (NAR) revealed that existing home sales fell again in June.
Existing home sales — completed transactions that include single-family homes, townhomes, condominiums and co-ops — declined 3.3 percent from May to a seasonally adjusted annual rate of 4.16 million.
“There are simply not enough homes for sale,” NAR Chief Economist Lawrence Yun said in a statement. “The market can easily absorb a doubling of inventory.”
Total housing inventory at the end of June was 1.08 million units, according to the data.
NAR’s data also showed that median home prices remain resilient and are again nearing their pandemic-era peak.
“Home sales fell but home prices have held firm in most parts of the country,” Yun said. “The national median home price in June was slightly less than the record high of nearly $414,000 in June of last year. Limited supply is still leading to multiple-offer situations, with one-third of homes getting sold above the list price in the latest month.”
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