Existing Home Sales Fall in May to 6-month Low
Tuesday, June 21, 2021 11:53 AM

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National Association of Realtors (NAR) said in its release that the existing home sales in May were down as temporary factors and financing problems weighed on the market.

Existing home sales that include single-family, townhomes, condominiums and co-ops, fell 3.8 percent to a seasonally adjusted annual rate of 4.81 million in May from a downwardly revised 5.00 million in April, and are 15.3 percent below a 5.68 million pace in May 2010 when sales were surging to beat the deadline for the home buyer tax credit. This is the lowest level since last November.

Lawrence Yun, NAR chief economist, said temporary factors held back the market in May, as implied from prior data on contract signings. “Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May,” he said. “Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward. The pace of sales activity in the second half of the year is expected to be stronger than the first half, and will be much stronger than the second half of last year.”

The decline was in line with the forecasts. Economists expected sales to fall to 4.80 million units in May, based on a sharp 12 percent drop in pending home sales in April. Existing home sales fell a revised 1.8 percent in April to 5.0 million units, down from the initial estimate of a 0.8 percent fall to 5.05 million units.