US home sales rose in July as mortgage rates eased a bit and home prices grew more slowly

The latest data from the National Association of Realtors shows that sales of previously occupied U.S. homes saw a 2% increase in July. This rise can be attributed to a combination of factors, including a slight decrease in mortgage rates, slower home price growth, and the highest number of properties on the market in five years.

In July, existing home sales reached a seasonally adjusted annual rate of 4.01 million units, marking a 2% increase from the previous month. This figure also represents a 0.8% increase compared to the same period last year, surpassing economists’ expectations of a 3.92 million pace.

Despite the overall increase in sales, home prices continued to rise for the 25th consecutive month. However, the rate of growth has been gradually slowing down. In July, the national median sales price saw a modest 0.2% increase from the previous year, reaching $422,400.

The U.S. housing market has been facing challenges since 2022, when mortgage rates started to rise from historically low levels. Last year, sales of previously occupied homes hit a three-decade low, indicating a significant downturn in the market.

The spring homebuying season, typically the busiest time for real estate transactions, was disappointing this year due to persistently high mortgage rates. Many potential buyers were deterred by the lack of affordability, which has been a major obstacle for aspiring homeowners amid skyrocketing home prices.

Overall, the recent uptick in home sales in July is a positive sign for the housing market. With more inventory available and a slight easing of mortgage rates, buyers may find more opportunities to enter the market. However, challenges such as affordability and price growth remain key concerns for both buyers and sellers in the current real estate landscape.