U.S. home prices rose 5.6 percent in May from a year earlier as buyers competed for a scarcity of listings.

Prices climbed 0.2 percent on a seasonally adjusted basis from April, the Federal Housing Finance Agency said in a report Thursday from Washington. The average estimate of 18 economists was for a 0.4 percent gain, according to data compiled by Bloomberg.

The improving job market and low mortgage rates are fueling competition for housing and driving up values. The inventory of previously owned homes on the market at the end of May fell 5.7 percent from a year earlier, according to the National Association of Realtors.

“Without relief from new construction, housing inventory will likely remain tight, boosting home prices and constraining affordability,” Fannie Mae Chief Economist Doug Duncan said in a July 19 statement on the outlook for U.S. economic growth.

The FHFA index measures transactions for single-family properties financed with mortgages owned or securitized by Fannie Mae and Freddie Mac. It doesn’t provide specific prices. The national median price of an existing single-family home was $241,000 in May, up 4.6 percent from a year earlier, according to the Realtors group.

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