Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Existing home sales slip 2% in May

By Hibah Yousuf, staff reporter


NEW YORK (CNNMoney.com) -- Existing home sales slipped in May and missed estimates but sustained a strong pace as homebuyers who qualified for the expired tax credit moved to close deals ahead of the June 30 deadline.

The National Association of Realtors reported that existing home sales dipped 2.2% last month to a seasonally adjusted annual rate of 5.66 million units, down from the upwardly revised rate of 5.79 million in April. Sales year-over-year were up 19.2%.

Analysts surveyed by Briefing.com were looking for resales in May to rise to an annual rate of 6.1 million units.

Although homebuyers had to sign contracts by the end of April to qualify for a tax credit up to $8,000, they have until the end of June to close deals. Existing home sales data is based on transaction closings, so figures still reflect strong interest in the credit.

So the tax credit, stabilizing home prices and low mortgage rates kept sales at elevated levels last month, said Lawrence Yun, NAR chief economist.

"We are witnessing the ongoing effects of the homebuyer tax credit, which we'll also see in June real estate closings," Yun said.

The Senate could pass an amendment to push the closing deadline back to Sept. 30 as part of a controversial job and tax bill.

Price and inventory: The NAR report showed that the median price of homes sold in May was $179,600, up 2.7% from a year ago. Just under a third of homes sold during the month were distressed properties.

Total housing inventory fell 3.4% to 3.89 million existing homes for sale. That represents a 8.3-month supply at the current sales pace, down from a 8.4-month supply in April. A six month of supply is considered normal.

Sales by property and region: Sales of single-family homes declined 1.6% in May compared to the prior month, while condominium and co-op sales sank nearly 7%.

The Northeast fared the worst last month, with sales plunging 18.3% to an annual level of 890,000 units in May. That's still 12.7% higher than a year earlier.

Resales in the Midwest were unchanged in May from the previous month at an annual pace of 1.33 million units. They rose by a modest 0.5% in the South and 4.9% in the West.  To top of page

Index Last Change % Change
Dow 18,339.24 110.94 0.61%
Nasdaq 5,318.55 12.84 0.24%
S&P 500 2,171.37 11.44 0.53%
Treasuries 1.57 0.01 0.71%
Data as of 3:31am ET
Company Price Change % Change
Procter & Gamble Co 89.46 1.10 1.24%
Bank of America Corp... 15.38 0.09 0.59%
Chesapeake Energy Co... 6.75 0.52 8.35%
Transocean Ltd 10.02 0.60 6.37%
Micron Technology In... 17.44 -0.56 -3.11%
Data as of Sep 28
Sponsors

Sections

California's state Treasurer is suspending its business relationship with Wells Fargo over the next year due to the bank's opening of unauthorized accounts. More

Oil prices rose 5% Wednesday after OPEC leaders announced the first oil production cut in 8 years. More

Many of the biggest tech companies are joining forces to establish best practices for developing artificial intelligence. More

A new report assesses the affordability, quality and availability of child care in every state. Connecticut ranks best overall, while West Virginia comes in last. More