(CN) — Consumers balked at buying existing homes in July, driving sales down 1.3 percent to their lowest level in 2017, the National Association of Realtors said Thursday.
The association pegged sales of existing homes last month at 5.44 million. Despite the second straight monthly drop, sales are 2.1 percent higher than a year ago.
The report comes on the heels of a Commerce Department report, released Wednesday, that said the sale of newly-built homes plummeted 9.4 percent in July, to a seasonally adjusted annual rate of 571,000 , down from 630,000 in June.
Lawrence Yun, the Realtor association’s chief economist, said “buyer interest in most of the country has held up strongly this summer and homes are selling fast, but the negative effect of not enough inventory to choose from and its pressure on overall affordability put the brakes on what should’ve been a higher sales pace.”
“Contract activity has mostly trended downward since February and ultimately put a large dent on closings last month,” Yun said.
The number of existing homes listed for sale has plunged 9 percent over the past 12 months to 1.92 million properties.
The median sales price has risen 6.2 percent from a year ago to $258,300, more than double the pace of growth in average hourly earnings.
The lack of homes on the market is also causing properties to sell more quickly. The average number of days on the market was 30 in July, compared with 36 a year ago.
In July, sales dropped 14.5 percent in the Northeast and fell 5.3 percent in the Midwest. But buying picked up 2.2 percent in the South and 5 percent in the West.
Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.8 months a year ago.
On a related note, mortgage rates have dropped to their lowest levels since the presidential election.
The average 30-year fixed rate mortgage charged 3.86 percent this week, according to mortgage buyer Freddie Mac.
Average rates began to climb after President Donald Trump won the election in November. However, they’ve declined in recent months as uncertainty has surrounded his tax and infrastructure policies.