US Home Sales Sink to 14-Month Low
US Home Sales Sink to 14-Month Low
The News
Sales of previously owned US homes fell 2% in August to a seasonally adjusted annual rate of 3.98 million units, the slowest pace since June 2025, the National Association of Realtors said Thursday.
Buyers are being squeezed from both sides: mortgage rates are at a one-year high and the median sale price hit a record for the month of August.
The drop came even though there are more homes for sale than at any point in over a decade.
The Numbers
Sales were down 1.2% from a year earlier. Inventory rose 3.2% to 1.62 million homes, the highest since November 2019 and up 5.9% year over year — a 4.9-month supply at the current sales pace, up from 4.6 months in July.
The median existing home price was $429,100, up 1.6% from August 2025 and a record for an August. Homes sat on the market a median 31 days, up from 29 in July.
Timeline
The US and Israel attack Iran. The average rate on a 30-year mortgage has risen more than 70 basis points since, tracking long-term Treasury yields pushed up by war-driven inflation worries, monetary policy uncertainty and rising government debt, Reuters reported.
The contracts behind August's closings are signed. Rates move sharply higher in the middle of July.
The 30-year fixed rate averages 6.66%, according to Freddie Mac data cited by Reuters.
The 30-year average surges to 6.71%, the highest in more than a year.
NAR reports August existing home sales at a 3.98 million annual rate, matching the forecast in a Reuters poll of economists.
Reactions
"Mortgage rates and home sales move in opposite directions, so it's not surprising to see a mild dip in home buying activity due to high mortgage rates," NAR chief economist Lawrence Yun said. "Still, home prices are rising, and existing home sales are actually up 1.6% year-to-date through the first eight months of the year."
MarketWatch framed the report as a demand problem, noting that the lack of buyers is what pushed the number of homes for sale to nearly a seven-year high. CNBC said homebuyers "continue to struggle amid higher mortgage rates and lofty home prices."
What's Next
Because existing home sales are counted at closing, September's report will reflect contracts signed while rates were climbing toward their one-year high — leaving little relief in the near-term data.
Freddie Mac's weekly rate survey and the next NAR release are the numbers to watch. Yun's benchmark for a healthy market is a 40% first-time buyer share; August came in at 30%.
More
The weakness was not evenly spread. Sales fell in the Northeast, Midwest and South and held steady in the West, according to Reuters. Price gains were strongest in the Northeast, where inventory is tightest, and the West was the only region where the median price fell year over year, CNBC reported.
The bottom of the market is taking the hit. Sales of homes priced between $100,000 and $250,000 were down 10% from August 2025, while sales above $1 million rose 3.9% — the only price range that grew.
Cash buyers made up 27% of August sales. First-time buyers were 30%, up from 29% in July and 28% a year ago. Investors and second-home buyers accounted for 15%, down from 21% a year earlier. Distressed sales, including foreclosures, held at 2%.
Poll
What is keeping buyers out of the housing market?
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