US house prices took what appeared to be a seasonal dip in June, according figures from the National Association of Realtors (NAR). While remaining well above levels experienced during the same month in 2012, a 1.2 per cent fall was noted. This lead to a seasonally adjusted rate of 5.08 million from a downwardly revised 5.14 million in May. However, with June 2012 posting just a 4.41 million unit level, experts aren't concerned.
Lawrence Yun, NAR chief economist, explained there is still enough momentum in the market, despite high interest rates. "Affordability conditions remain favorable in most of the country, and we’re still dealing with a large pent-up demand," he said. "However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market."
NAR also recorded a rise in national average commitment rates for 30-year, conventional, fixed-rate mortgages. In June the rate increased to 4.07 per cent from 3.57 per cent in May. This is the highest rate recorded since October 2011 and is considerably greater than the 3.68 per cent noted in June 2012.
However, inventory conditions continue to broadly favour sellers, rising 1.9 per cent to 2.19 million existing homes for sale. This represents a 5.2-month supply at the current sales pace, up from five months in May. Listed inventory is 7.6 per cent below a year ago, when there was a 6.4 month supply. A lack of stock is helping to drive up property prices and the national median existing-home price for all housing types was $214,200 (£139,516) in June. This is a year-on-year increase of 13.5 per cent and the 16th consecutive month of year-over-year price increases.
NAR president Gary Thomas, broker-owner of Evergreen Realty, explained price rises are improving the position of homeowners and 16 per cent of realtors now claim to have worked with a client that previously had an "underwater mortgage".