Home sales stall in August

U.S. home resales dropped in August despite an increase in first-time buyers and a slowdown in price growth.

Sales of existing homes – completed transactions that involve single-family homes, condominiums, co-ops and town homes – fell 4.8 percent last month compared with July to a seasonally adjusted annual rate of 5.31 million units, according to data released Monday by the National Association of Realtors.

Year-over-year, the number was stronger: existing home sales rose 6.2 percent compared with August 2014, when the seasonally adjusted sales figure was about five million units. Year-over-year sales have now risen for 11 consecutive months, the association stated.

Despite that good news, the July-to-August drop is a sign the U.S. housing market – previously thought to be on solid footing – might be losing momentum, said Lawrence Yun, chief economist for the Chicago-based association.

“Sales activity was down in many parts of the country last month, especially in the south and west, as the persistent summer theme of tight inventory levels likely deterred some buyers,” Yun said in a statement. “The good news for the housing market is that price appreciation the last two months has started to moderate from the unhealthier rate of growth seen earlier this year.”

The median price in August for an existing home was $228,700, a 4.7 percent increase from exactly one year earlier. Year-over-year median prices have gone up for 42 consecutive months, according to the association.