[US real estate issue] Severe housing shortage, June home sales “lowest in 14 years”
June home sales hit lowest in 14 years due to severe housing shortage This is the US real estate report for August 8, 2023. Due to the severe housing shortage, home sales in June were at their lowest since 2009. Sales of existing homes in June fell at a seasonally adjusted annual rate of 4.16 million, down 3.3% from May and down 18.9% from June a year ago, according to the National Association of Realtors. The weak housing market is not due to a lack of demand, but rather a severe supply shortage. There were 1.08 million homes sold in June, 13.6% fewer than in June 2022. A 6-month supply is considered balanced between buyers and sellers, with the June figure showing a 3.1-month supply.
Due to this supply shortage, housing prices are rising. The median price of existing homes sold in June was $410,200, the second highest price recorded since NAR began tracking prices. “The current real estate market is so short of homes that it could easily absorb twice the inventory,” said Lawrence Yun, NAR’s chief economist. “Home sales are down, but home prices remain high and multiple offers are common. “The selling price is more than 3/1 higher than the listing price,” he analyzed. Due to this housing shortage, profits from new home sales are increasing. DR Horton, America's largest homebuilder, reported a significant increase in new orders in its latest earnings call. Donald Horton, Chairman of the Board of Directors, said, “Despite continued rising mortgage rates and inflationary pressures, limited supply of low-priced homes and favorable demographics supporting housing demand, net sales orders remain strong.” “It increased by 37% compared to the previous year’s quarter,” he said.