22 August 2023
In July, existing home sales plummeted more than expected, marking a 2.2% month-over-month decline and a stark 16.6% decrease year-over-year. This drop is the worst since 2010 and even surpasses the lows during the COVID lockdowns. NAR Chief Economist Lawrence Yun highlighted that inventory availability and mortgage rates have negatively impacted buyers. Builders have tried to boost sales through various means, but their efforts are running short. A concerning trend suggests that new home prices may soon dip below existing home prices, a phenomenon last observed during the 2005 housing bubble. There’s a significant disparity between homebuyer and homebuilder confidence, and with mortgage rates as an indicator, the market may face further turmoil.