Home sales take a dive in June, normally the strongest month: Remax

The onset of summer typically comes with the largest volume of home sales, however exorbitant prices kept potential buyers at bay, according to Remax's National Housing Report.

Home sales dropped 7.8% in June from the year before and 4.7% from a healthy May while reaching the highest median sales price of $276,000 in the 10-year history of the report. June has set the mark for highest annual median price for the last six years.

Boise, Idaho, had June's biggest median price increase at 10.7%, followed by Albuquerque, N.M., at 10.4% and Philadelphia's 10%. The only metro areas to decrease were San Francisco by 2% and Hartford, Conn., with a 0.1% dip.

Despite the big dollar figures, properties didn't stay on the market long, however. The average number of days between listing and sale fell three days from May to 44 — the second fastest for this figure since 41 in June 2018.

"Record prices appear to have kept June sales figures from topping a strong May," Adam Contos, Remax chief executive officer, said in a press release. "Nevertheless, there are indications, including the return of very favorable mortgage rates, that the pace could pick up in July. Several encouraging longer-term trends — ongoing demand, improving inventory levels, low interest rates — are helping the market make incremental progress on multiple fronts. But supply remains a concern, so we need more homes to be built."

Housing inventory had mixed results in June. The total homes for sale rose 1.3% year-over-year while edging down 0.6% month-over-month. The supply fell to 2.8 months from 3.1 months the year prior, while staying static from May.

"Pent-up demand, stemming from a strong economy, lower mortgage rates and continued wage growth, still offers builders a reason to be cautiously optimistic," Odeta Kushi, First American deputy chief economist, said in a statement.

"However, supply remains tight and building pace lags behind historical standards, especially for single-family homes. Market conditions are ripe for buyers to face more competition in the second half of the year. Permits, a leading indicator of future housing starts, fell nearly 7% compared with one year ago. However, one month does not make a trend — permits had been steadily increasing since February of this year."

Remax's report is based on an analysis of multiple listing service data for residential property types across the 54 largest housing markets.