span>span>Thursday 19th May /span>span>2022/span>span> - 15:32 (BST)/span>/span>
Existing US home sales fell during April as inflationary pressures and wider economic uncertainty begin to weigh on the country’s housing market. The latest data released by the National Association of Realtors showed sales fell to 5.61 million over the month, down from 5.77 in March and well below the market expectation of 5.65 million.
First-time buyers made up nearly a third of this figure as many are keen to secure their property ahead of widely anticipated Federal Reserve interest rate rises on the horizon. Cash sales also made up a larger fraction of the transactions, climbing to the highest share since 2014 and also due to the rising base rates.
The 30-year fixed-rate mortgage averaged 5.30% during the week ended May 12, the highest since July 2009, according to data from mortgage finance agency Freddie Mac. It has increased by more than 100 bps since mid-March when the Federal Reserve started raising interest rates to cool domestic demand and bring down high inflation.
Properties remained on the market for an average of 17 days whilst the average house price touched $375,00 – up 15% from March 2022 and marking a record 122nd consecutive month of year-on-year increases.
The news follows yesterday's report that permits for future U.S. homebuilding tumbled to a five-month low of 3.2% in April. The housing construction sector is caught between sharply rising mortgage rates and declining affordability along with supply-chain constraints hampering builds.
