The median price of a home in April was a record $391,200, rising 14.8% from a year ago, according to a report from the National Association of Realtors. While price growth was robust, it was a slower annual pace of increase than in recent months and determined buyers pushed their budgets to the edge to buy a home before mortgage rates climb further.
The price increase marks more than a decade’s worth of consecutive year-over-year increases, the longest running streak on record.
But as the average rate on a 30-year mortgage crossed over 5% in April, the rising cost of financing a home pushed some prospective home buyers out of the market.
Sales of existing homes, which include single-family homes, townhomes, condominiums and co-ops, dropped 2.4% from the prior month and 5.9% from one year ago.
“Higher home prices and sharply higher mortgage rates have reduced buyer activity,” said Lawrence Yun, NAR’s chief economist. “It looks like more declines are imminent in the upcoming months, and we’ll likely return to the pre-pandemic home sales activity after the remarkable surge over the past two years.”