U.S. home sales declined for seventh month in a row

Sales of existing homes fell for the seventh straight month in August, as sharply higher mortgage rates slammed the brakes on buying activity.

Driving the news: Numbers published yesterday by the National Association of Realtors showed existing home sales (as opposed to new construction) slipping to an annualized rate of 4.8 million last month.

• That's roughly 20% lower than last year's breakneck pace in August 2021.
• Go deeper: Prices finally started to drop in the last two months, with the median existing home selling for $389,500, down nearly 6% from the peak of $413,800 in June.

Fed chair Jerome Powell acknowledged at his press conference Wednesday that homebuying has slowed — and added that he thinks the housing market needs to experience a correction for supply and demand to become better aligned.

The bottom line: Home prices are likely to continue falling in the coming months — but affordability remains poor with 30-year fixed mortgage rates higher than 6%.