A recent trend of weakening home sales – both new and existing – likely continued in June, according to Zillow’s June home sales forecast, reflecting the increasingly heavy weight of limited inventory and soft new construction activity.
A recent trend of generally weakening home sales – both new and existing – likely continued in June, according to Zillow’s June home sales forecast, reflecting the increasingly heavy weight of limited inventory and soft new construction activity.
Sales of existing homes have been particularly volatile since November, rising one month and falling the next — a trend expected to continue in June. Sales rose slightly in May, but are forecasted to fall in June. Tight for-sale inventory is clearly weighing on the market, with existing home sales roughly flat since autumn. We expect existing home sales (reported by the National Association of Realtors on July 24) to fall 1.6 percent in June from May, to 5.53 million units at a seasonally adjusted annual rate (SAAR). This would still put existing home sales up 1 percent compared to last June, but the annual growth rate has been steadily slowing.
Sales of newly built homes routinely beat expectations in the first quarter of 2017, before slowing substantially in April and May. We expect this recent softness to continue into June, with new home sales (reported by the U.S. Census Bureau on July 26) forecasted to fall 5.9 percent from May to 573,000 units (SAAR) – the lowest number of new home sales since December. The low level of homes that began construction earlier this year is likely to be reflected in actual sales levels of newly built homes in June. Single-family home starts increased steadily from 2011 through mid-2016, but have been essentially flat since last autumn.
Related:
