WASHINGTON, Aug 18 (Reuters) – U.S. home resales fell again in July to their lowest level in more than two years, a sign that rapidly rising interest rates are dampening demand for real estate .
They fell 5.9% to 4.81 million units in annualized and seasonally adjusted data, the lowest level recorded since May 2020, after 5.11 million (revised) in June, according to the statistics. released Thursday by the National Association of Realtors (NAR).
Economists polled by Reuters on average expected a smaller drop, to 4.89 million.
This is the sixth consecutive month of decline in home resales, which account for the bulk of residential real estate sales in the United States. Over one year, their decline reached 20.2%.
Faced with soaring inflation, the Federal Reserve has raised its key rate by 225 basis points since March.
The minutes of the central bank’s July monetary policy meeting released on Wednesday show that its officials have acknowledged that the rise in rates is weighing on housing demand and that they anticipate a further slowdown.
While volumes are falling, home prices remain on an upward trend: the median home price rose 10.8% year-on-year to $403,800. But this is the weakest increase in two years.
At the pace of July sales, it would take 3.3 months to clear the inventory of unsold homes, compared to 2.6 months a year ago. A figure between six and seven months is considered to reflect a situation of balance between supply and demand. (Report Lucia Mutikani, French version Laetitia Volga, edited by Marc Angrand)