Existing-home sales declined for the second consecutive month in October, the National Association of Relators reported. Still, home prices stayed strong thanks to tight inventory.
Total existing-home sales were down 3.2% to a seasonally adjusted annual rate of 5.12 million. Nevertheless, this is still a 6.0% improvement over October 2012, and the 28-month streak of year-over-year improvement remains unbroken.
Single-family home sales were down 4.1% to a seasonally adjusted annual rate of 4.49 million, but remained 5.2% above year-ago figures.
Meanwhile, the national median existing-home price was $199,500, up 12.8% year-over-year. Part of this gain is attributed to fewer distressed home sales in 2013.
“The erosion in buying power is dampening home sales,” said NAR chief economist Lawrence Yun. “Moreover, low inventory is holding back sales, while at the same time pushing up home prices in most of the country. More new home construction is needed to help relieve the inventory pressure and moderate price gains.”
Total housing inventory was down 1.8% to 2.13 million homes available for sale, marking a 5.0-month supply up marginally from September's.