Existing home sales—including single-family, townhomes, condominiums and co-ops—increased two percent to a seasonally adjusted annual rate of 4.99 million units in May from a level of 4.89 million in April, but are 15.9 percent below the 5.93 million-unit pace in May 2007.

The national median existing home price for all housing types was $208,600 in May, down 6.3 percent from a year ago when the median was $222,700.

Lawrence Yun, NAR chief economist, said despite the May increase, there is still a lot of inventory in the market.

“The large supply of homes on the market clearly favors buyers, and it should take several months to draw the inventory down,” he said. “Stabilization in home prices can only occur with buyers returning to the market, so we are encouraged by rising home sales, particularly in distressed markets. Foreclosures and short sales appear to be a larger part of the market, particularly in California, and are creating a drag on current home prices.”

Total housing inventory at the end of May fell 1.4 percent to 4.49 million existing homes available for sale, which represents a 10.8-month supply at the current sales pace, down from a 11.2-month supply in April.

Single-family home sales rose 1.6 percent to a seasonally adjusted annual rate of 4.41 million in May from 4.34 million in April, but are 14.5 percent below the 5.16 million-unit pace in May 2007. The median existing single-family home price was $206,700 in May, which is 6.8 percent below a year ago.

Existing condominium and co-op sales increased 5.5 percent to a seasonally adjusted annual rate of 580,000 units in May from 550,000 in April, but are 24.6 percent lower than the 769,000-unit level a year ago. The median existing condo price was $223,400 in May, down 2.1 percent from May 2007.

Regionally, existing home sales in the Midwest rose 5.5 percent in May to a pace of 1.16 million but are 16.5 percent lower than a year ago. The median price in the Midwest was $165,300, which is 0.7 percent below May 2007.

In the Northeast, existing home sales rose 4.6 percent to an annual rate of 910,000 in May, but are 15 percent below May 2007. The median price in the Northeast was $278,000, down 2.4 percent from a year ago.

Existing home sales in the West increased two percent to an annual pace of 1.02 million in May, but are 12.8 percent below a year ago. The median price in the West was $286,600, which is 16 percent lower than May 2007.

In the South, existing-home sales slipped 0.5 percent to an annual rate of 1.91 million in May, and are 17 percent below May 2007. The median price in the South was $175,000, down 4.3 percent from May 2007.