US Existing-Home Sales Rise to Highest Level Since 2022, but Pending Sales Flatten

On Monday, Redfin reported that US existing-home sales rose 2.8% month-over-month in May, reaching their highest level since October 2022.

Overall home sales, including both existing and newly built homes, increased 3.8% from April, also reaching the highest level since October 2022. Redfin said closed sales rose as many May transactions reflected contracts signed in April, when mortgage rates were in the 6.3% range for much of the month.

Redfin said the sales increase was also supported by buyer leverage, with more sellers than buyers in the market, allowing buyers to negotiate price reductions and seller concessions. The company also cited an improved labor market and stronger activity in markets including San Jose, San Francisco, and West Palm Beach, FL.

However, Redfin noted that pending sales, a more current measure of housing demand, flattened as mortgage rates rose. In May, 59.8% of homes sold for less than their original list price, down slightly from the prior month and marking the sixth straight monthly decline in that share.

Redfin said discounts remain common, but the buyer advantage has started to shrink. The median price for new listings was essentially flat in May, down 0.1% month-over-month, compared with a 2.0% increase in sale prices.