Existing home sales surprised on the upside, managing to eke out small gains compared to last month. This was despite heightened economic uncertainty in April — when homes sold in May went under contract.
- Existing home sales rose 0.8% in May to a seasonally adjusted annual rate (SAAR) of 4.03 million. Sales were 0.7% lower than in May 2024, according to the National Association of Realtors (NAR).
- Total housing inventory at the end of May increased to 1.54 million units. That’s up 6.2% from April and 20.3% higher than a year ago.
- The median existing-home sales price in May was $422,800, up 1.3% from a year ago.
What happened: Existing home sales surprised on the upside, managing to eke out small gains compared to last month. This was despite heightened economic uncertainty in April, when homes sold in May went under contract. However, this year’s home shopping season is still softer compared to a year ago. Sales of existing homes contracted compared to last May, directionally consistent with Zillow’s Sales Nowcast. Despite fewer sales in April, Zillow estimates the total dollar value of existing homes sold was up 1.0% year-over-year, mostly due to an increase in the average sales price of existing homes in the past year. This still represents a downshift from the 4.6% year-over-year increase in March.
Why it matters: While sellers have returned to the market this spring, demand appears to be off to a slow start this home shopping season. However, Zillow data suggests that next month’s home sales count is likely to modestly increase, given newly pending listings — the precursor to a sale — saw a slight improvement in May.
Existing home sales are now projected to reach 4.14 million in 2025, a modest uptick from last month’s estimate of 4.12 million. This would represent a 1.9% increase over 2024. Higher housing inventory — which dampens price growth — gives buyers more negotiating leverage and is expected to be a tailwind for sales. As such, the total value of existing homes sold is still expected to see a modest increase in 2025.
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