Existing Home Sales Fall as Home Prices Hit Record

Existing home sales in the United States sank by 8.4% from the previous month to an annualized rate of 3.91 million in January of 2026, firmly below market expectations of 4.18 million, after having reached a 3-year high of 4.35 million in the last month of 2025. It was the sharpest drop in nearly 4 years to the lowest level since September 2024. Unsold inventory fell by 0.8% to 1.22 million units, equal to 3.7 months of supply. "The below-normal temperatures and above-normal precipitation this January make it harder than usual to assess the underlying driver of the decrease and determine if this month’s numbers are an aberration,” said NAR Chief Economist Dr. Lawrence Yun. “Affordability conditions are improving, with NAR’s Housing Affordability Index showing that housing is the most affordable it’s been since March 2022. This is due to wage gains outpacing home price growth and mortgage rates being lower than a year ago. However, supply has not kept pace and remains quite low."

Existing home sales in the United States surged by 5.1% from the previous month to an annualized rate of 4.35 million in December of 2025, firmly above market expectations of the sharpest increase in nearly two years to the highest level in nearly three years. The drop drove inventory to plunge by 18.1% from the previous month to 1,180,000, equivalent to 3.3 months of supply at the current sales rate. The median price of existing home sales eased further to $405,400 in the period, a 0.4% increase from the previous year. According to NAR Chief Economist Lawrence Yun, “2025 was another tough year for homebuyers, marked by record-high home prices and historically low home sales. However, in the fourth quarter, conditions began improving, with lower mortgage rates and slower home price growth. The gains were broad-based, with all four major regions improving from the prior month.”

Existing home sales in the United States rose by 0.5% from the previous month to an annualized rate of 4.13 million in November of 2025, a third straight increase to the highest level in nine months. It compared with market expectations of 4.2 million. The result was aligned with a pullback in benchmark mortgage rates amid a series of poor labor results released in the period. Sales of single-family homes rose 0.8% to 3.75 million. In the meantime, the median sales price for homes increased 1.2% from a year ago to $409,200, one of the weakest gains since mid-2023. With the sales increase, housing inventory fell by 5.9% from the previous month to 1.43 million units, equal to 4.2 months of supply and the weakest since March. “Existing-home sales increased for the third straight month due to lower mortgage rates this autumn,” NAR Chief Economist Lawrence Yun said in a statement. “However, inventory growth is beginning to stall.”