Existing Home Sales Increase, Ending Five-Month Slide

(National Association of Realtors)

Existing home sales grew in November, breaking a streak of five consecutive monthly declines, according to the National Association of Realtors.

Total existing-home sales–completed transactions that include single-family homes, townhomes, condominiums and co-ops–increased 0.8% in November to a seasonally adjusted annual rate of 3.82 million in November. Year-over-year, sales fell 7.3% (down from 4.12 million in November 2022).

“The latest weakness in existing home sales still reflects the buyer bidding process in most of October when mortgage rates were at a two-decade high before the actual closings in November,” NAR Chief Economist Lawrence Yun said. “A marked turn can be expected as mortgage rates have plunged in recent weeks.”

Selma Hepp, Chief Economist with CoreLogic, Irvine, Calif., noted U.S. home sales remain on pace for the worst year seen in decades. “It is unlikely 2024 will prove to be as bad, and we believe the market will slowly begin to tick up through the year, keeping a slow pace in step with the gradual reductions in the Fed rate and lower mortgage rates as the months tick pass,” she said.

Freddie Mac reported 30-year fixed-rate mortgages averaged 6.95% as of December 14, their first time below 7% since August. That’s down from 7.03% the previous week but up from 6.31% one year ago.

Total housing inventory totaled 1.13 million units at the end of November, down 1.7% from October but up 0.9% from one year ago, NAR reported. Unsold inventory sits at a 3.5-month supply at the current sales pace, down from 3.6 months in October but up from 3.3 months a year ago. Meanwhile, the median existing home price for all housing types in November increased 4.0% year over year to $387,600. “Home prices keep marching higher,” Yun added. “Only a dramatic rise in supply will dampen price appreciation.”