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Retreating 20.4% from one year ago, total existing-home sales, or completed transactions that include single-family homes, townhomes, condominiums, and co-ops, slightly increased in May by 0.2% to a seasonally adjusted annual rate of 4.3 million, according to the National Association of Realtors (NAR). All four regions posted year-over-year sales declines, while the South and West saw month-over-month improvement.

"Mortgage rates heavily influence the direction of home sales," says NAR chief economist Lawrence Yun. "Relatively steady rates have led to several consecutive months of consistent home sales."

At the end of May, total housing inventory was 1.08 million units, up 3.8% from April and down 6.1% from one year ago (1.15 million). At the current sales pace, the unsold inventory sits at a 3-month supply, up from 2.9 months in April and 2.6 months in May 2022.

"Available inventory strongly impacts home sales, too," Yun adds. "Newly constructed homes are selling at a pace reminiscent of pre-pandemic times because of abundant inventory in that sector. However, existing-home sales activity is down sizably due to the current supply being roughly half the level of 2019."

The median existing-home price for all housing types in May was $396,100, a decline of 3.1% from May 2022 ($408,600). Prices grew in the Northeast and Midwest but fell in the South and West.

“The median home price fell compared to a year earlier because of this requirement for buyers to stick to a budget. When you look month to month instead of year over year, home prices have risen four months in a row—something we see almost every spring. If prices follow the usual pattern, they will peak in June and then gradually fall until next spring," notes Holden Lewis, home and mortgage expert, NerdWallet.

Down from 22 days in April but up from 16 days in May 2022, properties typically remained on the market for 18 days in May, with 74% of homes sold on the market for less than a month.

First-time buyers were responsible for 28% of sales in May, down from 29% in April but up from 27% in May 2022. All-cash sales accounted for 25% of transactions in May, down from 28% in April and the same as one year ago.

Individual investors or second-home buyers, who make up many cash sales, purchased 15% of homes in May, down from 17% in April and 16% the previous year. Virtually unchanged from last month and the prior year, distressed sales—foreclosures and short sales—represented 2% of sales in May.

Down 0.3% from 3.86 million in April and 20% from the previous year, single-family home sales dipped to a seasonally adjusted annual rate of 3.85 million in May. The median existing single-family home price was $401,100, down 3.4% from May 2022.

Existing condominium and co-op sales posted at a seasonally adjusted annual rate of 450,000 units in May, up 4.7% from April but down 23.7% from last year. The median existing condo price was $353,000 in May, nearly identical to last year ($353,100).

In the Northeast, existing-home sales declined 2% from April to an annual rate of 500,000 in May, down 25.4% from May 2022. The median price in the Northeast was $439,000, up 2.5% from last year.

The Midwest’s existing-home sales fell 2.9% from one month ago to an annual rate of 990,000 in May, decreasing 20.8% from the previous year. The median price in the Midwest was $298,000, up 1.1% from one year ago.

Existing-home sales in the South increased 1.5% from April to an annual rate of 2.02 million in May, sliding 16.5% from the prior year. Down 2.7% from May 2022, the median price in the South was $361,400.

In the West, existing-home sales were up 2.6% from April to an annual rate of 790,000 in May, down 25.5% from last year. The median price in the West was $596,500, down 5.7% from one year ago.