With the average US home price breaching $400,000 for the first time, inventory needs to ‘rise substantially’ experts say

However, it isn’t completely 2019 again.

New data from the NAR shows the median existing-home price for all housing types in May was $407,600, up 14.8% from May 2021.

“This marks 123 consecutive months of year-over-year increases, the longest-running streak on record,” the NAR said.

Prices by region

Sales of previously existing homes dropped 3.4% in May, according to NAR data.

"Further sales declines should be expected in the upcoming months given housing affordability challenges from the sharp rise in mortgage rates this year," Yun said.

“Nonetheless, homes priced appropriately are selling quickly and inventory levels still need to rise substantially — almost doubling — to cool home price appreciation and provide more options for home buyers.”

The West topped all U.S. regions in having the highest median home prices at $633,800, an increase of 13.3% from May 2021.

The Northeast had the second highest median home prices at $409,700, representing a 6.7% rise from one year ago.

The median price in the South was $375,000, a 20.6% jump from one year ago. The NAR noted that for the ninth consecutive month, the South recorded the highest pace of price appreciation in comparison to the other three regions.

Meanwhile, the median price in the Midwest was $294,500, up 9.5% from one year before.

No change in distressed sales

With the U.S. already reporting a negative GDP for Q1, coupled with 40-year high inflation, experts are warning of an incoming recession that could put more financial strain on homeowners trying to make mortgage payments.

For now, NAR’s May data shows distressed sales — foreclosures and short sales — represent less than 1% of all sales. That remains unchanged from the previous month and a year ago in May 2021.

But there are slight changes elsewhere.