Sales of existing homes in the U.S. dropped 1.8 percent in June as prospective buyers continued to struggle in a housing market with record high prices and an acute shortage of supply.
The number of houses for sale last month fell to 1.96 million, down more than 7 percent from a year ago, according to the National Association of Realtors. That marked the 25th consecutive month of year-over-year decreases in available homes.
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Meanwhile, the median price for a home in the U.S. reached $263,800, a jump of 6.5 percent over June 2016, and the 64th straight month of year-over-year increases.
While sales are running slightly ahead of last year's pace, thanks to strong demand, many would-be buyers are being "tripped up" by the low supply and high prices, said Lawrence Yun, NAR's chief economist, .
"Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines," Yun said.
Listings -- the number of new homes entering the market -- have remained flat since the end of the recession, according to Zillow. In June, 561,740 homes were listed, compared to 544,482 homes a year ago and 577,821 in June 2015.
But those homes are being snapped up faster than ever. The NAR reports that, on average, a home remained on the market for just 28 days in June, down from 34 days a year ago; well over half -- 54 percent -- sold in less than a month.
"The key is not fewer listings, but white-hot demand," said Svenja Gudell. Zillow's chief economist. "This causes the number of homes for sale at a given point in time to seem especially limited."
While several factors are contributing to the supply shortage, one of the most vexing is the shortage of laborers and construction contractors. The National Association of Homebuilders reported that, since 2012, the share of builders having trouble hiring basic-skill workers, such as carpenters and bricklayers, nearly tripled to 56 percent in 2016.
There is also a persistent shortage of buildable lots, especially in urban areas that are increasingly attractive to younger first-time homebuyers. A July 2017 survey of homebuilders by the NAHB found that 64 percent reported that the overall supply of developed lots in their areas was low to very low -- the largest share since the association began asking the question in 1997.