Existing Home Sales Drop 1.2%

Sales of existing homes fell 1.2% to a seasonally adjusted annual rate of 5.08 million for June, according to a National Association of Realtors (NAR) report released today.

After jumping a revised 3.4% in May, analysts had expected sales to head even higher to an annual rate of 5.27 million for June. Compared to June 2012, sales were up 15.2% and they remain near a 3.5-year high. The numbers include completed transactions on single-family homes, townhomes, condominiums, and co-ops.

As sales slowed, the housing inventory rose 1.9% to 2.19 million existing homes. At the current sales rate, this represents a 5.2-month supply of existing homes, 4% higher than May's supply.

Sales of previously occupied homes in June reflect contracts that were mostly signed in April and May, when mortgage rates were lower. The NAR also noted that first-time buyers, who usually drive healthy markets, aren't participating as much in the current recovery. They made up only 29% of buyers in June, below the 40% that is typical.

But even as sales tapered off, the median sales price moved higher for the 16th straight month of year-over-year increases. June's $214,200 median price tag is 13.5% higher than a year ago, putting sellers in a strategic position. "Rising values have improved the position of homeowners, and 16% of Realtors surveyed in June report they worked with a client that previously had an underwater mortgage," said NAR President Gary Thomas in a statement.

The median time on the market fell four days from May to 37, and is nearly half the time houses hung out on the market a year ago.

-- Material from The Associated Press was used in this report.

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