MAY HOUSING WATCH May Home Sales Down 15% Compared to Five-Year Average
“Supply is expected to improve, which will give buyers more options and help tamp down record-high asking prices for existing homes.” said Lawrence Yun, NAR’s chief economist.
Home sales in Salt Lake County increased 3% in May compared to the same month a year earlier but were down 15% compared to the five-year sales average (2015-2019) for the month of May. Typically, May is a strong month for home sales, with an average of nearly 1,800 sales. However, the continued lack of new listings and existing inventory of homes for sale has dragged sales down. In May, there were 1,501 homes sold (all housing types) in Salt Lake County. New listings in Salt Lake County fell nearly 20% in May. Pending sales also slowed to 1,664, down 15% compared to May 2020, a month when home buyers pulled back from purchasing because of Covid-19 fears.
The limited supply of housing for sale has caused home prices to climb sharply. The median price of all housing types sold in May soared to $450,700, up 24% compared to a median price of $365,000 in May 2020. The median price of a single-family home in Salt Lake County increased to $535,000 in May, up 31% from a year earlier. Nationally, home sales in total climbed year-over-year, up 44.6% from a year ago (4.01 million in May 2020). “Lack of inventory continues to be the overwhelming factor holding back home sales, but falling affordability is simply squeezing some first-time buyers out of the market,” said Lawrence Yun, NAR’s chief economist. “The market’s outlook, however, is encouraging,” Yun continued. “Supply is expected to improve, which will give buyers more options and help tamp down record-high asking prices for existing homes.” In the U.S., the median existing-home price for all housing types in May was $350,300, up 23.6% from May 2020 ($283,500), as every region registered price increases. This is a record high and marks 111 straight months of year-overyear gains since March 2012. First-time buyers were responsible for 31% of sales in May, also even with April but down from 34% in May 2020. NAR’s 2020 Profile of Home Buyers and Sellers – released in late 20204 – revealed that the annual share of first-time buyers was 31%. Individual investors or second-home buyers, who account for many cash sales, purchased 17% of homes in May, even with April and up from 14% in May 2020. All-cash sales accounted for 23% of transactions in May, down from 25% in April and up from 17% in May 2020. A new study released by NAR last week – the 2021 Vacation Home Counties Report – found that from January to April 2021, the share of vacation home sales to total existing-home sales rose to 6.7%. Vacation home sales jumped 57.2% yearover-year compared to the 20% year-over-year growth in total existing-home sales.
36 | Salt Lake Realtor ® | July 2021
