By Conor Dougherty and Nick Timiraos
Home sales fell in January to their lowest level in 18 months as higher prices and mortgage rates squeezed buyers who continue to face shortages of properties for sale.
Sales of previously owned homes fell by 5.1% to a seasonally adjusted annual rate of 4.62 million, the National Association of Realtors said Friday. The median sales price in January stood at $188,900, up 10.7% from a year earlier.
Friday’s report shows how the housing market is struggling to shift gears, from a marketplace propelled by investors chasing foreclosed properties to one where first-time and trade-up buyers play a larger role now that the supply of distressed properties has dropped sharply.
Sales volumes are being challenged by reduced affordability of homes and severe winter weather in many parts of the country—two factors putting a damper on demand.
But real-estate agents say the market also is being constrained by a lack of supply. There were only 1.9 million homes on the market in January, according to the Realtors’ group. While that was a 2.2% increase from December, only three months during the past 12 years have seen inventories at even lower levels.
