Sales of existing homes saw a rare dip in August, the first decline after four consecutive months of increases, as more cash-paying investors retreated from the market, according to the National Association of Realtors.
Total existing-home sales — completed transactions that include single-family homes, townhomes, condominiums and co-ops — decreased 1.8 percent to a seasonally adjusted annual rate of 5.05 million in August.
That’s down from a slight downwardly-revised 5.14 million in July.
Despite the dip, sales are at the second-highest pace of 2014. But activity remains 5.3 percent below the 5.33 million-unit level from last August, which was also the second-highest sales level of 2013.
All-cash investors, who had taken part in bidding wars over recent months, apparently saw fewer deals worth pursuing.
Lawrence Yun, NAR chief economist, says sales activity remains stronger than earlier in the year, but fell last month as investors took a pause.
“There was a marked decline in all-cash sales from investors,” he said. “On the positive side, first-time buyers have a better chance of purchasing a home now that bidding wars are receding and supply constraints have significantly eased in many parts of the country.”
All-cash sales were 23 percent of transactions in August, dropping for the second consecutive month (29 percent in July), and representing the lowest overall share since December 2009 (22 percent).
Individual investors, who account for many cash sales, purchased 12 percent of homes in August, down from 16 percent last month, and 17 percent in August 2013.
Sixty-four percent of investors paid cash in August.
The median existing-home price for all housing types in August was $219,800, which is 4.8 percent above August 2013. This marks the 30th consecutive month of year-over-year price gains.