Home Prices Top $350K for the First Time

But with buyers squeezed out, the rate of sales is starting to slow down
By Rob Quinn,  Newser Staff
Posted Jun 22, 2021 2:35 PM CDT
Home Prices Top $350K for the First Time
A real estate brokerage sign stands in front of a house in Norwood, Mass.   (AP Photo/Steven Senne, File)

The median home price in the US has topped $350,000 for the first time—but with record prices squeezing out buyers, some analysts say the market may be on the brink of cooling. The National Association of Realtors says the median existing-home price in May was $350,300, a record year-on-year increase of 23.1%, the Wall Street Journal reports. The median price topped $300,000 for the first time just 10 months earlier. The May rise marks 111 straight months of year-on-year price increases and economists say a shortage of supply is continuing to drive prices up, reports CNN. According to the Redfin brokerage, more than half the homes sold in May sold for above their list price. Some 23% of sales were all-cash, reflecting the number of big institutional investors entering the market.

Economists say home sales are starting to slow down, however, as soaring prices and the lack of inventory turn would-be buyers away. Total home sales dropped in May for the fourth month in a row. "Affordability appears to be now squeezing away some buyers," says Lawrence Yun, NAR’s chief economist. per the Journal. "There are so many people who have been outbid, frustrated they are unable to buy." The AP reports that the number of homes for sale in May rose 7% month-on-month to 1.23 million—still very low by historical standards, and down around 20% from the previous May. There are now more realtors in the US than there are homes for sale, the AP notes. (Analysts say this might be the most competitive real estate market the US has ever seen.)

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