More homes came on the market while fewer sold in August compared with last year.

New listings in the city of Sioux Falls increased 5.3 percent, while closed sales dropped 7.2 percent, according to the Realtor Association of the Sioux Empire Inc.

Opposing factors and trends are competing to define the direction of the market, including declining mortgage rates, according to an analysis included with the report.

“Yet most experts agree these reductions are unlikely to bring sufficient relief, at least in the short term, for first-time home buyers,” it said.

“The lack of affordable inventory and the persistence of historically high housing prices continue to affect the housing market, leading to lower-than-expected existing home sales at the national level.”

The average price of a home sold in Sioux Falls in August took a 19.7 percent jump year-over-year, to $273,703. Year-to-date the average price is up a more modest 5.2 percent.

“As many homeowners refinanced their homes to take advantage of declining interest rates, consumer confidence in housing was reported to be at historically high levels,” the report said.

“Even so, real estate professionals will need to monitor the market for signs of continued imbalances. Although the inventory of affordable homes at this point remains largely stable, it is stable at historically low levels, which may continue to push prices higher and affect potential buyers across the U.S.”

Inventory in Sioux Falls is at a 3.7-month supply, down 5.5 percent from the same time last year. That represents 1,046 homes for sale.

“After the U.S. Federal Reserve lowered benchmark interest rate for the first time in a decade, mortgage rates have come down approaching historically low levels not seen since 2016,” the report said.

“Although home refinancing has jumped up and consumer confidence in housing is increasing, lack of affordable inventory continue to affect first-time home buyers and limit the increases in new sales.”