The median existing-home sales price topped $400,000 for the first time in May as existing-home sales fell for the fourth month in a row, the National Association of REALTORS® said.  

At the same time, total housing inventory rose 12.6% on a month-over-month basis to 1,160,000 units.    

Total existing-home sales, which are completed transactions, including single-family homes, townhomes, condominiums and co-ops, slid 3.4% from April to a seasonally adjusted annual rate of 5.41 million in May. Year over year, sales volume was down 8.6% from 5.92 million transactions in May 2021.      

The median existing-home price for all housing types in May was $407.600, up 14.8% from a year before, as median prices rose in each region.      

“Home sales have essentially returned to the levels seen in 2019 — prior to the pandemic — after two years of gangbuster performance,” NAR chief economist Lawrence Yun said in a press release. “Also, the market movements of single-family and condominium sales are nearly equal, possibly implying that the preference towards suburban living over city life that had been present over the past two years is fading with a return to pre-pandemic conditions.” 

The average commitment rate for a 30-year, conventional, fixed-rate mortgage was 5.23% in May, up from 4.98% in April, according to Freddie Mac. The average commitment rate across all of 2021 was 2.96%. 

April’s unsold inventory represented a 2.6-month supply at the current sales pace, up from 2.2 months in the prior month and down from 2.5 months last year.    

Properties typically remained on the market for 16 days in May, down from 17 days in both April and May 2021. Eighty-eight percent of homes sold in May were on the market for less than a month.  

“Further sales declines should be expected in the upcoming months given housing affordability challenges from the sharp rise in mortgage rates this year,” Yun added. “Nonetheless, homes priced appropriately are selling quickly, and inventory levels still need to rise substantially — almost doubling — to cool home-price appreciation and provide more options for homebuyers.” 

By property type, single-family home sales in May slid to a seasonally adjusted annual rate of 4.8 million, down 3.6% from 4.98 million in the previous month and down 7.7% from a year earlier. The median existing single-family home price was $414,200, up 14.6% on a year-over-year basis.      

Existing condominium and co-op sales came in at a seasonally adjusted annual rate of 610,000 units in May, down 1.6% from April and 15.3% compared to May 2021. The median existing condo price rose 14.8% year over year to $355,700.

In May, first-time buyers were responsible for 27% of sales, down from 28% in April and down from 31% in May 2021, while individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes, down from 17% in April and 17% in May 2021.