Bidenflation and the K-Shaped Housing Market: Million Dollar Home Sales Still Soaring, First Time Buyers Sinking

WASHINGTON, DC - JUNE 24: U.S. President Joe Biden delivers remarks alongside Vice Preside
Photo by Kevin Dietsch/Getty Images

Sales of the priciest homes were strong in September and the share of sales to first-time buyers fell, highlighting increasing inequality in the Biden era housing market.

The median existing-home price for all housing types in September was $352,800, a 13.3 percent increase from a year ago, data released Thursday by the National Association of Realtors showed. Prices were up across the country.

The median price for single-family homes $359,700 in September, up 13.8 percent from September 2020.

Total sales rebounded in September after fading the previous month. Sales were up seven percent from August to a seasonally adjusted annual rate of 6.29 million in September. Analysts had forecast a smaller gain to 6.03 million from August’s 5.88 million. Compared with a year ago, however, sales were down 2.3 percent.

Sales to first-time homebuyers fell to 28 percent from 29 percent in August. A year ago, first-time buyers accounted for 31 percent of purchases. Before the pandemic, first-time buyers typically made up 33 percent of buyers.

“First-time buyers are hit particularly hard by the historically high home prices as they largely do not have the savings required to buy a home or equity to offset such a purchase,” said Laawrence Yun, the cheif economist of the NAR.

As Breitbart has previously reported, the housing market is increasingly K-shaped in the Biden era, with sales of high-priced homes rising and sales of lower prices homes sinking.

Sales of home priced under $100,000 were down 21.2 percent compared with a year ago. Home priced between $100,000 and $250,000 declined by 22.7 percent. Together those two categories made up around 29 percent of houses sold in the month, seven-tenths of a point lower than in August.

Sales of houses priced between $250,000 and $500,000 rose by 3 percent. This price category accounts for 43.5 percent of the housing market, matching the August share.

Houses priced between $500,000 and $750,000 saw sales climb 21.4 percent. Sales of houses priced from $750,000 to one million dollars rose 26.6 percent. Sales of houses over $1 million were up 30.5 percent. The top three price categories made up around 27.5 percent of sales in September, up from 26.8 a month earlier. The market share of million dollar homes moved up from 5.6 percent to 5.9 percent.

Home prices were down slightly from a month earlier, a typical seasonal change as sellers typically price their homes high in the spring and begin lowering prices on unsold homes once school starts. In August, the median price of an existing single family home was $363,800, so the price fell 1.13 percent on a monthly basis.

The pace of annual gains is decelerating, in part because the the housing market’s current boom was well underway by this time last year and prices were soaring. Last year, September’s existing home sales were 20.6 percent higher than the previous year, the largest annual gain since the housing bubble year 2006. The median price was up 14.8 percent.  This year, median prices were up 23.6 percent annually in May, 23.4 percent in June, 17.8 percent in July and 14.9 percent in August.

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