WASHINGTON (AP) — Home-buying slumped in November, with some Americans priced out of the market by rising prices or constrained by a shortage of sales listings.
The National Association of Realtors said Thursday that sales of existing homes fell 1.7% last month to a seasonally adjusted annual rate of 5.35 million. The number of properties for sale has dwindled 5.7% from a year ago to 1.64 million units.
Affordability has also posed a persistent challenge. The median sales price has climbed 5.4% from a year ago to $257,400, outpacing wage growth.
“This problem is good news for homeowners, but bad for those wanting to buy a home,” said Jennifer Lee, a senior economist for BMO Capital Markets.
Still, lower mortgage rates have provided a base of demand. Over the past 12 months, the decline in the typical mortgage rate from 4.9% to 3.8% this November has helped boost annual sales by 2.7%.
The housing market has enjoyed nearly eight years of rising prices, steadily recovering from the Great Recession that was triggered in large part by subprime mortgages and a wave of foreclosures. But the recovery in prices has proved to be a barrier for first-time buyers: With fewer starter homes priced below $250,000 on the market, sales at that level have declined over the past year.
November’s decline in existing home sales came from the South and West. Sales increased in the Northeast and Midwest.