Home Sales Slip, Prices Show Strength

Existing home sales slipped slightly in June, while home prices continued their seasonal upswing. Here are the key takeaways.

·       Existing Home Sales Ease in June

·       Homeownership Continues to Build Wealth

·       Fed Announces Task Force “A-Team”

·       Jobless Claims Snapshot

Existing Home Sales Ease in June

After rising for two consecutive months, existing home sales slipped 2.4% from May to June, reaching a seasonally adjusted annual rate of 4.09 million homes. Despite the monthly decline, sales were nearly 3% higher than a year ago. Housing inventory also edged lower from May but remains 1.3% above year-ago levels.

What’s the bottom line? According to NAR Chief Economist Lawrence Yun, the recent ups and downs in home sales highlight just how sensitive buyers are to changes in mortgage rates and overall affordability.

While inventory has improved compared to last year, the housing market is still undersupplied by historical standards. If buyer demand picks up more quickly than the supply of homes for sale, home prices could come under renewed upward pressure, reinforcing the need for more housing inventory.

Homeownership Continues to Build Wealth

Home prices increased 0.6% from April to May and are 0.8% higher than they were a year ago, according to Cotality's latest Home Price Insights report.

What’s the bottom line? Cotality also noted a strong seasonal upswing, with home prices rising 1.6% over the past three months. Looking ahead, the firm forecasts prices will increase another 4.8% over the next year.

For current homeowners and prospective buyers alike, it's another reminder of the long-term financial benefits of owning a home. For example, a $500,000 home that appreciates by 5% would gain about $25,000 in value over the course of a year, showing how steady appreciation can help build wealth over time.

Fed Announces Task Force “A-Team”

Fed Chair Kevin Warsh has launched five new task forces focused on improving how the Federal Reserve gathers economic data, communicates with the public, and evaluates key areas such as inflation, jobs, productivity, and its balance sheet.

What’s the bottom line? The newly appointed members bring a wide range of experience, including former Fed officials, international central bank leaders, and business executives. The goal is to help modernize the Fed’s approach to decision-making and strengthen how it evaluates economic conditions when setting future policy.

Warsh expects the task forces to deliver their recommendations by the end of the year.

Jobless Claims Snapshot

New unemployment claims came in at 215,000, holding at roughly the same level for the third straight week. Meanwhile, continuing unemployment claims remained elevated at 1.814 million.

What’s the bottom line? Initial jobless claims are still relatively low by historical standards, but they may not capture the full picture of today’s labor market. Some workers who lose their jobs are turning to freelance, contract, or gig work instead of filing for unemployment benefits, meaning labor market weakness may be understated in the claims data.

Meanwhile, the elevated level of continuing claims suggests many unemployed workers are taking longer to find their next job, pointing to a job market that remains challenging for those actively searching for work.