WASHINGTON (Reuters) – U.S. home sales fell in August as supply remained tight and prices accelerated further, the latest indication that the loss of the momentum in the housing market persisted through the third quarter.

The National Association of Realtors reported Wednesday that existing home sales declined by 2.0% to 5.88 million units in August, an adjusted seasonally. In all four regions, sales fell. Reuters polled economists to predict that sales will fall at a rate 5.89 millions units per month in August.

The bulk of U.S. home sales fell by 1.5% year-over-year.

In the COVID-19 panic, housing prices rose quickly amid a population exodus. People worked remotely and took online classes. These factors fueled a desire for larger houses in suburban areas and other lower-density places. Supply outpaced the demand for single-family houses, with the surge being dominated by this segment of the housing market.

It has been difficult for builders to raise production because of the high cost of building materials, as well as the lack in land and labor. On Tuesday, government data showed that single-family housebuilding dropped for the second month straight in August.

The pandemic tailwind has slowed, but housing demand is strong because of near-record low mortgage rates. Also, rising wages due to tightening labor markets.

From a year earlier, the median house price rose 14.9% to $356,700 by August. Although the rate of change is slowing, bidding wars have slowed. The upper end of the market continues to see the most sales.

Last month’s inventory of homes that were previously owned was 1.29million, which is 13.4% less than a year ago. The current inventory would be exhausted in 2.6 months at the August sales pace. That’s down from 3.0 months last year. The supply of inventory is considered healthy if there’s a balance between the supply and demand. It can last from six to seven months.

As the acceleration of the housing market has been largely driven by mismatches between supply and demand rather than the poor lending practices which caused the 2008 financial crisis, economists don’t believe there will be another bubble.

Some potential buyers may not be able to buy because of higher prices. Property listings remained for 17 days on average in August, which was unchanged from July. Eighty-seven per cent of homes that were sold in August remained on the market for less then a month.

The 29% figure is the lowest in January 2019 and down 30% from July, 33% last year.