With home prices and mortgage rates at or near record levels, fewer houses sold in May. Sales were down 1.7% compared with April and 2.9% compared with 2023, according to a new analysis from Redfin.

What You Need To Know

  • Home sales fell 1.7% in May compared with April

  • They are down 2.9% compared with May 2023

  • There have only been two other months in the past decade that had lower sales — in October 2023 when mortgage rates hit a 23-year high and in May 2020 after the pandemic began

  • The median home price hit a record $439,716 in May, while the median rate for a 30-year-fixed mortgage was 7.06%

The real estate website said there have only been two months in the past decade that have had fewer home sales — in October 2023 when mortgage rates hit a 23-year high and in May 2020 when the pandemic brought sales to the lowest level on record.

“Buyers today are facing many of the realities of a hot market even though few homes are changing hands,” Redfin Senior Economist Elijah de la Campa said in a statement. “Sales are sluggish because high homebuying costs are making both house hunters and prospective sellers skittish.”

The median price for a U.S. home was 5.1% higher in May than it was a year earlier, hitting a record of $439,716. The median rate for a 30-year-fixed mortgage was 7.06% in May — up from 6.99% a month earlier and from 6.43% a year ago.

The combination of high home prices and high mortgage rates is keeping the supply of available homes low, as owners with ultra-low mortgage rates secured during the pandemic hold onto their properties.

In May, the number of active home listings increased 0.4% compared with April and was up 11.1% compared with a year earlier. But they remain about 25% lower than levels before the pandemic.

“With so few homes for sales, buyers in some markets are getting into bidding wars, which is helping push home prices to record highs,” de la Campa said.