US existing home sales rise in July, ending downward trend

(FILES) A for sale sign is displayed outside of a home for sale on August 16, 2024 in Los Angeles, California. – Sales of previously owned homes in the United States edged up in July, industry data showed on August 22, 2024, breaking a four-month trend of declines. (Photo by Patrick T. Fallon / AFP)

Washington, United States — Sales of previously owned homes in the United States edged up in July, industry data showed on Thursday, breaking a four-month trend of declines.

Homebuyers in the world’s biggest economy have been grappling with a surge in mortgage rates after the US central bank rapidly lifted the benchmark lending rate in 2022.

But the popular 30-year fixed-rate mortgage ticked down slightly in late July, potentially offering some relief to buyers.

READ: Long-term mortgage rates in U.S. ease for third straight week

Existing home sales rose 1.3 percent from June to an annual rate of 3.95 million, seasonally adjusted, said the National Association of Realtors (NAR).

This was slightly above a Briefing.com consensus of 3.9 million, and an uptick from June after four straight months of falling sales.

“Despite the modest gain, home sales are still sluggish,” said NAR chief economist Lawrence Yun, noting that the figures remain relatively low.

“But consumers are definitely seeing more choices, and affordability is improving due to lower interest rates,” he said.

Compared with a year ago, sales of existing homes were down 2.5 percent according to the NAR.

READ: U.S. existing home sales down 1.9%

The median sales price was $422,600 in July, higher than the same month in 2023, and all four US regions saw price increases.

With the Federal Reserve widely expected to cut interest rates in September, homebuyers might be holding back in hopes of mortgage rates cooling further in the near future.

As of August 15, the 30-year fixed-rate mortgage averaged 6.5 percent according to Freddie Mac, down from 6.8 percent in late July.

Housing inventory also edged up from June, NAR data showed.

“This is a glimmer of hope, not a turnaround signal,” said economist Robert Frick of the Navy Federal Credit Union.

“Home sales remain weak, but lower mortgage rates should bring more potential sellers off the sidelines,” he added.