The slide in U.S. home sales continued for a fourth straight month in May amid a supply crunch that has fueled record-high prices.

The National Association of Realtors reported Tuesday that existing home sales fell 0.9% last month from April to a seasonally adjusted annualized rate of 5.8 million units. Moreover, just 1.23 million homes were for sale at the end of May, a 20.6% drop from a year earlier.

“Home sales fell moderately in May and are now approaching pre-pandemic activity,” Lawrence Yun, NAR’s chief economist, said in a news release. “Lack of inventory continues to be the overwhelming factor holding back home sales, but falling affordability is simply squeezing some first-time buyers out of the market.”

The median price of an existing home in May was $350,300, a 23.6% year-on-year increase. It is the highest median price ever recorded and the strongest annual appreciation ever.

“It’s becoming clear that record-high price growth and an enduring shortage of available homes are beginning to hinder would-be homebuyers,” said Matthew Speakman, an economist at Zillow.

Yun, however, said the outlook for the housing market was “encouraging,” noting that “Supply is expected to improve, which will give buyers more options and help tamp down record-high asking prices for existing homes.”

“With the public health situation brightening, there is cautious optimism that inventory will improve,” Reuters said. “Some homeowners were reluctant to list their homes because of fear of contracting the virus from potential buyers touring their properties. Some elderly Americans likely delayed downsizing due to the pandemic.”

“Economists are also hopeful that higher prices will entice some owners to put their homes on the market,” Reuters added.

There were 1.23 million previously owned homes available for sale in May, up 7.0% from April. First-time buyers accounted for 31% of sales in May, down from 34% a year ago, while all-cash sales made up 23% of transactions, up from 17% a year ago.

Sales of homes priced at $100,000 to $250,00 dropped 2% from a year ago, while sales of homes priced $750,000 to $1 million jumped 178%.

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