Aug 14

Homeowners Reaping Big Equity Gains Despite Cooling Sales

Even though home sales slowed significantly in June, homeowners are still seeing impressive equity growth. Here’s a breakdown of what’s happening:

Housing Market Overview

  • Sales dipped by 2.7% in June, matching the sluggish pace seen last year for existing homes (single-family, townhomes, condos, co‑ops). Nar Realtor

Prices Are Still Rising

  • The median home price in June hit $435,300, a record high for the month and up 2% from the prior year. Nar Realtor
  • Over the past five years, homeowners have seen an average gain in home equity of $140,900. Nar Realtor
  • The wealth gap between owners and renters remains wide—NAR projects that by 2025, homeowners’ median net worth could reach $430,000, compared to just $10,000 for renters. Nar Realtor

Inventory and Buyer Behavior

  • Inventory is improving: unsold homes in June rose by about 16% year-over-year, though supply still lags behind demand. Nar Realtor
  • All-cash purchases accounted for nearly 30% of sales, a historically high share. Many repeat buyers are leveraging cash from previous home sales. Nar Realtor

Regional Trends

  • Northeast: Sales down 8% month-over-month; median price rose 4.2% year-over-year to $543,300.
  • Midwest: Sales decreased by 4%, with prices up 3.4% to $337,600.
  • South: Sales fell 2.2%; prices edged up 0.3% to $374,500.
  • West: Sales rose 1.4% from May, but were down 4.1% year-over-year; median price up 1% to $636,100. Nar Realtor

What’s Holding Buyers Back—and What Might Help

  • Elevated mortgage rates (mid‑ to high‑6% range) remain the main challenge for buyers. Nar Realtor
  • NAR economist Lawrence Yun suggests that if rates drop to around 6%, about 5.5 million more households—including 1.6 million renters—could afford median-priced homes. Nar Realtor
  • If interest rates ease later this year, improved affordability, steady economic growth, and job gains may reinvigorate the housing market. Nar Realtor

Summary

Even as home sales cool, owners are seeing solid equity gains—thanks to rising prices and limited home inventory. While affordability remains a hurdle due to high interest rates, there’s hope if rates decline. Homeowners continue to build wealth, while buyers wait in the wings for better conditions

National Association of REALTORS®
Reprinted with permission

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