US existing home sales dip in August

Existing home sales in the US were little changed last month, contrary to forecasts, a leading business lobby said.

According to the National Association of Realtors, in seasonally adjusted terms, existing home sales dipped by 0.4% month-on-month to reach an annualised pace of 4.8m.

Economists had penciled-in a decline to 4.7m.

"The housing sector is the most sensitive to and experiences the most immediate impacts from the Federal Reserve's interest rate policy changes," said NAR chief economist, Lawrence Yun.

"The softness in home sales reflects this year's escalating mortgage rates. Nonetheless, homeowners are doing well with near nonexistent distressed property sales and home prices still higher than a year ago."

In comparison to July, only one US region registered a fall, while two others saw increases and in the other sales were unchanged.

Year-on-year on the other hand, sales declined across all regions and in total were down by 19.9%.

The median price of an existing home was 7.7% higher year-on-year at $389,500.

Housing inventory fell by 1.5% versus July to reach 1.28m and was flat in comparison to the year earlier month.

Unsold inventory stood at 3.2 months' worth of supply at the current sales pace, the same as in July and up from 2.6 months one year before.

"Inventory will remain tight in the coming months and even for the next couple of years," Yun added.

"Some homeowners are unwilling to trade up or trade down after locking in historically-low mortgage rates in recent years, increasing the need for more new-home construction to boost supply."