The latest Real Estate Nowcast indicates existing home sales will drop in June, according to Ten-X, an online real estate transaction marketplace.
Existing home sales are forecasted to hit a seasonally adjusted annual rate between 5.28 million and 5.64 million with a targeted number of 5.49 million. This represents a decrease of 2.3% from the National Association of Realtors existing home sales report for May and 0.7% from last year.
“Pending home sales numbers, mortgage applications and online search activity all suggest that the market for existing home sales may be cooling off slightly as we enter the summer months,” said Rick Sharga, Ten-X executive vice president.
“It's possible that home purchases in the first half were accelerated by consumers trying to get deals done before interest rates increased,” Sharga said. “If that's the case, we may see existing home sales plateau for the balance of 2017.”
Last month, the company predicted home sales would fall between seasonally adjusted rates of 5.37 and 5.73 million with a targeted number of 5.5 million. NAR’s report came in at 5.62 million.
The Ten-X Residential Real Estate Nowcast predicts the median existing home prices will increase to between $244,194 and $269,899 with a target price point of $257,046. This represents an increase of 1.7% from May and an increase of 3.8% from last year.
“While sales keep edging up, historically low inventory levels continue to restrain the pace of growth,” Ten-X Chief Economist Peter Muoio said. “Meanwhile, intensifying competition between owner-occupants and increasingly active investors amid the low inventory situation, are generating substantial price increases.”
“This price appreciation is beneficial for existing homeowners, but will continue to affect affordability,” Muoio said. “As long as the labor market remains strong and wages continue to increase, the housing market will remain on solid footing.”