WASHINGTON — U.S. homebuyers pulled back in July, as sales declined amid a shortage of available properties and steadily rising prices.
Sales of existing homes fell 3.2 percent last month to a seasonally adjusted annual rate of 5.39 million, the National Association of Realtors said Wednesday. The decline marks a reversal from rising demand that pushed sales in June to their highest level since February 2007.
Fewer homes are coming onto the market, putting a cap on the sales growth enjoyed earlier this year thanks in part to a low mortgage rate and brightening job market. Rising demand for homes is a positive. But the dwindling supply of listings has pushed up prices, which suggests a market not yet at full health.
This mismatch between supply and demand creates an environment of limited sales growth and escalating home values.
"Sales are not rising as much as they are capable of, but prices are rising at a faster than sustainable clip," said Stephen Stanley, chief economist at Amherst Pierpont Securities.
The number of listings has tumbled 5.8 percent from a year ago to 2.13 million, meaning that would-be homebuyers are struggling to find attractive properties in their price range and may be delaying their purchases.
Read Thursday's Arkansas Democrat-Gazette for full details.