KVIG Informative

Median home prices climbed to their highest level on record in June, even as sales slowed and mortgage rates ticked upward — a combination squeezing first-time buyers further out of the market.

Existing home sales fell 2.4% in June from May, to a seasonally adjusted annual rate of 4.09 million units, the National Association of Realtors said Thursday. Sales were up 2.8% compared with June a year earlier.

The pace fell short of the roughly 4.21 million economists had expected, according to FactSet. Home sales have hovered near a 4-million annual pace since 2023, well below the historic norm of about 5.2 million.

The median sales price rose 1.8% year-over-year to $440,600 in June, an all-time high on data going back to 1999. Prices have now risen on an annual basis for 36 consecutive months, NAR said.

First-time buyers accounted for 33% of purchases in June, down from 35% in May but up from 30% a year earlier. Historically, first-time buyers made up about 40% of the market — a gap NAR attributes largely to affordability.

Mortgage rates have trended higher since the U.S. and Iran began exchanging strikes in June, disrupting shipping through the Strait of Hormuz and pushing up the bond yields lenders use to price home loans. Rates remain below where they stood a year ago.

Pricing trends vary sharply by region. Since peaking in 2022 at $449,000, list prices have fallen 7.3% in the West and 3.5% in the South, but climbed 10% in the Midwest and 12.6% in the Northeast, according to Realtor.com. Unsold inventory stood at 1.56 million homes at the end of June — down slightly from May but still well short of the roughly 2 million homes for sale that was typical before the pandemic.

The math has not changed in four years: supply is not keeping pace with demand, and for a growing share of first-time buyers, wages alone no longer clear the gap. Increasingly, it is cash and existing equity — not income — that decide who gets to own a home in this market.