U.S. home resales unexpectedly fell in July to their lowest monthly level of the year due to a lack of properties for sale, which also continued to push up prices.
The National Association of Realtors said on Thursday existing home sales fell 1.3 percent to a seasonally adjusted annual rate of 5.44 million units last month. June’s sales pace was revised slightly lower to 5.51 million units.
Economists polled by Reuters had forecast sales rising 0.9 percent to a rate of 5.57 million units. Sales were up 2.1 percent from July 2016.
Supply was down 9.0 percent from a year ago. Housing inventory has declined for 26 consecutive months on a year-on-year basis.
A dearth of properties on the market has crimped the housing recovery and forced price appreciation to significantly outstrip wage gains.
The median house price was $258,300, a 6.2 percent rise from one year ago, reflecting the paucity of properties.
“Demand remains strong but inventory shortage is the choke point,” NAR chief economist Lawrence Yun said.
At the current sales rate, it would take 4.2 months to clear inventory, down from 4.8 months one year ago. Economists view a 6-month supply as a healthy balance between supply and demand.
The median number of days homes were on the market in July was 30, compared to 36 days one year ago.
Across the regions, the Northeast saw a decline of 14.5 percent and in the Midwest sales were down 5.3 percent. They jumped in the West by 5.0 percent while sales increased 2.2 percent in the South.