An uptick in historically low home mortgage rates appears to be to blame as does a shortage of properties in the hottest markets.
“Mortgage interest rates began to rise in May, taking some of the momentum out of contract activity in June,” Lawrence Yun, NAR chief economist said. “The persistent lack of inventory also is contributing to lower contract signings.”
The NAR said Monday that by the end of 2013, it expects home sales will be up 8 percent for the year and prices will have increased by 11 percent due to shortages.
The accelerating recovery in the housing market, which was devastated by the financial crisis of 2008, has, until now, been the main driving force of the lackluster economic recovery. Any further sign of weakening could make the economy vulnerable to shocks this fall as the White House and Congress contemplate a government shutdown and debt default.