U.S. home sales fell more than expected in September as a housing shortage caused prices to increase.
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The National Association of Realtors said on Tuesday that existing home sales fell 2.2 percent to a seasonally adjusted annual rate of 5.38 million units last month, ending two months of sales gains. Still, overall sales are up 3.9 percent from a year ago (5.18 million last September).
Despite historically low borrowing costs -- the Federal Reserve has voted twice this year to cut interest rates, helping the housing market by lowering mortgage costs -- sales have not increased, partially because of a lack of new housing options. Policymakers at the U.S. central bank are expected to lower rates again at the end of October.
“Home prices are rising too rapidly because of the housing shortage, and this lack of inventory is preventing home sales growth potential,” Lawrence Yun, NAR’s chief economist, said in a statement.
The 30-year fixed mortgage rate has dropped 1.16 percent from the year-ago period, to an average of 3.69 percent, according to mortgage finance agency Freddie Mac.
The median sales price climbed 5.9 percent from last year to $272,100, the 91st straight month of year-over-year gains.