“Home prices continue to march higher despite lower home sales,” said Lawrence Yun, the NAR’s chief economist. “Supply needs to essentially double to moderate home price gains.”in many places, especially for the most affordable homes. About 31% of homes purchased last month sold for more than their list price, Yun said.All told, there were 1.1 million homes on the market by the end of last month, down 0.9% from July and 14.1% from August last year, the NAR said.
The latest housing market figures are more evidence that many house hunters are being held back by a persistently low inventory of homes for sale and rising mortgage rates. Because home sales typically take about a month to be finalized once a contract is signed, transactions in August happened as the rate for a 30-year mortgage averaged just under 7%.
The weekly average rate on a 30-year home loan climbed jumped hit 7.23% last month, the highest level in more than 22 years, and has held above 7% since August, according to mortgage buyer Freddie Mac. High rates can add hundreds of dollars a month in costs for borrowers, limiting how much they can afford in a market already unaffordable to many Americans. They also discourage homeowners who locked in those low rates two years ago from selling.