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Consumer Sentiment Continues to Slide, Despite Softening Inflation
August 9, 2024If it feels like it’s all but impossible to buy a house right now, you’re not alone.
In June, existing-home sales in the U.S. fell by 5.4% to an annualized rate of 3.89 million, continuing a four-month downward trend.
Why? High prices and high interest rates.
The median sales price for a home hit a record $426,900, even as supply increased. Inventory reached 1.32 million homes—the highest since October 2020—yet remains below pre-pandemic levels.
Current market behaviors indicate that both buyers and sellers are waiting for the Federal Reserve to cut interest rates, with mortgage rates currently at 6.87%, down from April's peak of 7.29%.
Given how important home ownership is in the overall economic satisfaction of everyday Americans, all these trends collectively suggest that the U.S. consumer is feeling priced out and sitting on the sidelines. That’s why we’ll be keeping an eye on existing home sales if the Fed cuts interest rates to see what the response looks like.
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