U.S. Home Sales |Fell in August

(CN) - U.S. home sales fell in August as a worsening inventory shortage pushed prices higher.

The National Association of Realtors said Thursday that sales of existing homes declined 0.9 percent last month to a seasonally adjusted annual rate of 5.33 million the second straight monthly drop.

The two-month trend came a period of steady gains that have lifted home sales up 3 percent so far this year.

According to NAR, the inventory of homes for sale has plummeted, cascading down 10.1 percent from a year ago to 2.04 million homes.

The median home sales price was $240,200 in August, a 5.1 percent increase over the past year.

The increase means that many buyers have to save more for a down payment, which has contributed to the ownership rate slumping to a half-century low.

Lawrence Yun, the organization's chief economist, said recent job growth is not yielding higher home sales.

"Healthy labor markets in most the country should be creating a sustained demand for home purchases," he said. "However, there's no question that after peaking in June, sales in a majority of the country have inched backwards because inventory isn't picking up to tame price growth and replace what's being quickly sold."

Yun added: "Hopes of a meaningful sales breakthrough as a result of this summer's historically low mortgage rates failed to materialize because supply and affordability restrictions continue to keep too many would-be buyers on the sidelines."

Sales fell in the Midwest, South and West. Only the Northeast recorded sales gains.

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