Laura Kusisto and Sarah Chaney reported last week at The Wall Street Journal Online that, “Sales of previously owned U.S. homes declined in April, as inventory shortages and rising prices weigh on the market and higher mortgage rates begin to pose a threat to demand for the first time in years.
“Existing-home sales fell 2.5% in April from the prior month to a seasonally adjusted annual rate of 5.46 million, the National Association of Realtors said Thursday. Compared with a year earlier, sales in April were down 1.4%—the second consecutive month sales declined on an annual basis.
“Thus far the critical spring selling season—when some 40% of U.S. home sales occur each year—is off to a slow start despite a robust economy. That reflects increasing pressure on buyers, as home prices rise at about twice the rate of incomes and borrowing costs climb.”
The Journal writers explained that, “The median sale price for an existing home in April was $257,900, up 5.3% from one year ago.
“The rate for a 30-year mortgage rose to 4.66% this week from 3.99% at the end of last year, mortgage company Freddie Mac said Thursday. Mortgage rates rose in 15 of the 21 weeks of the year so far—the highest share since Freddie began tracking the data in 1972.
“The latest sales numbers reflect purchases that were closed in April, based on contracts signed in February and March. Rate increases were still modest when the contracts were signed and economists said the impact of higher rates will be felt more strongly in the coming months.”
