Existing home sales fell 3.6% to a seasonally adjusted 5.57 million-unit rate in December from a revised 5.78 million sales pace the previous month, first reported as 5.81 million, the National Association of Realtors announced Wednesday.

The December rate is a 1.1% increase from the same month a year ago. The headline number was below the median 5.70 million unit pace predicted by economists polled by IFR Markets.

“Existing sales concluded the year on a softer note, but they were guided higher these last 12 months by a multi-year streak of exceptional job growth, which ignited buyer demand,” said NAR chief economist Lawrence Yun. “At the same time, market conditions were far from perfect. New listings struggled to keep up with what was sold very quickly, and buying became less affordable in a large swath of the country. These two factors ultimately muted what should have been a stronger sales pace.”

Sales in the regions were lower in December. They were down 7.5% in the Northeast, 6.3% in the Midwest, 1.7% in the South, and 1.6% in the West.

The median sales price was $246,800 in December, off from $247,200 in November, but up 5.8% from a year ago.

Inventory levels dropped 11.4% from the previous month to 1.48 million existing homes, representing a 3.2-month supply at the current pace. Inventory was down 10.3% from the December 2016 level, and is the lowest level since NAR began tracking in 1999.

“The lack of supply over the past year has been eye-opening and is why, even with strong job creation pushing wages higher, home price gains – at 5.8 percent nationally in 2017 – doubled the pace of income growth and were even swifter in several markets,” said Yun.

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