Sales of existing homes in the US declined for a second straight month. High mortgage rates and elevated home prices have weighed on demand. Plus, the uncertainty brought on by global trade tensions and how they might impact the US economy has pulled would-be buyers out of the market. The situation is much the same as it is here in Canada, where existing home sales have fallen each month this year amid a loss in consumer confidence towards the economy.

• Sales of existing homes in the US declined by 0.5% to 4.00 million in April. This marked the worst April since 2009, which was during the Financial Crisis. April’s decline surprised economists who were expecting a 2.0% increase, based on a Bloomberg survey.
• The US saw its lowest number of home sales in a month since October 2024. Potential purchasers appear to be restrained by already high home prices and elevated mortgage rates. Mortgage rates have not fallen substantially, due in part to the US Federal Reserve Board holding steady this year.
• Earlier this week, the Mortgage Bankers Association of America (MBA) reported that mortgage applications dropped by 5.1% over the week ended May 16. The MBA also reported that the rate on a 30-year fixed-rate mortgage rose to 6.92% over the same week, the highest since February.
• The US economy received a bit of good news yesterday, with S&P Global reporting that manufacturing sector activity accelerated in May.

The uncertainty of trade tensions has impacted many areas of the US economy, including the real estate market, which has seen sales falling over the past two months. The global economy faces an abundance of uncertainty as trade tensions persist. While trade negotiations have begun, it’s still unclear what the trade environment will look like after deals are reached, or potentially not reached.

If you would like to discuss this economic and market update or have questions about your finances and investments, please feel free to contact me anytime.