Housing News

More Choices for Buyers Pushes Existing Home Sales to First Annual Increase in More than Three Years

There may be a light at the end of the tunnel for frustrated would-be homebuyers who find the home they want gets snapped up almost instantaneously—or never seems to hit the market in the first place.

That’s because an increase in the number of homes on the market in October drove existing home sales to increase annually for the first time in more than three years, according to a National Association of Realtors (NAR) report.

Sales of existing homes, which exclude new construction, rose 2.9% in October compared to the same month a year ago. It represents the first time sales increased annually since July 2021.

The number of existing homes sold also jumped 3.4% from September to October.

The rise is likely at least partially due to more homes hitting the market. The number of homes for sale shot up 19.1% year-over-year in October. Housing inventory rose 0.7% from September.

“The worst of the downturn in home sales could be over, with increasing inventory leading to more transactions,” said NAR Chief Economist Lawrence Yun in a statement. “Additional job gains and continued economic growth appear assured, resulting in growing housing demand.”

Homes stayed on the market a little longer as well, giving buyers a bit more time to make up their minds. The typical existing home was for sale for about 29 days in October, compared to 23 days a year earlier.

That doesn’t mean there aren’t still challenges for home buyers.

The median sale price for existing homes was $407,200 in October, up 4% year-over-year.

In addition, mortgage rates rose to an average 6.84% for 30-year, fixed-rate loans in the week ending Nov. 21, according to Freddie Mac data. That was up from an average 6.78% in the previous week.

Many real estate experts anticipate mortgage rates will come down in 2025 as the U.S. Federal Reserve lowers its own interest rates. (The Fed’s rates and mortgage rates are separate, but often move in the same direction.)

When mortgage rates fall, buying a home could become more affordable. That could give the housing market a boost.

“While mortgage rates remain elevated, they are expected to stabilize,” Yun said. “Additional [housing] inventory and more home building activity will help price increases moderate next year.”

Where did existing home sales rise the most?

The West experienced the biggest annual rise in existing home sales, increasing 8.5% from October of last year. The median sale price was $627,700, which represented a 4.4% year-over-year bump.

Annual sales rose by 2.3% in the South. Home prices ticked up 0.9% to a median $361,200.

Sales climbed 1.1% in the Midwest. The region had the lowest median home price of $305,300, which jumped 7.2% year-over-year.

In the Northeast, sales remained the same in October of this year and last year. The median price rose 7.6% to $472,900.