NPR
It’s a tough time to buy a home.
Home prices jumped to a record high last month, according to data out this week. Elevated mortgage rates kept many would-be buyers and sellers on the sidelines — and the lack of homes for sale is driving up prices for homes that are on the market.
May is typically peak season for buying and selling houses. But fewer existing homes were sold last month than in April. And sales were down 2.8% from a year ago, according to the National Association of REALTORS®.
A key reason is the elevated mortgage rates across the country. They have made it more expensive to buy a house, pushing some would-be buyers out of the market. In addition, many people who already own homes are reluctant to sell, since that would mean giving up their current, cheaper mortgage.
The relatively few homes that are selling are typically going for higher prices. The median price of a home sold in May was $419,300 — an all-time record.
Average home prices are climbing because the more affordable end of the market, including starter homes, has largely dried up.
“At lower price points, people are being priced out of the home-buying market, and there’s just less inventory when we think about homes that are under $250,000,” says Jessica Lautz, deputy chief economist for the REALTORS® association.
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