Existing-home sales dropped for the tenth straight month in November, down 7.7% from October and 35.4% YOY, according to the latest data from the National Association of Realtors.
Sales fell to a seasonally adjusted annual rate of 4.09 million from 4.43 million the month prior. All four major regions saw declines.
“In essence, the residential real estate market was frozen in November, resembling the sales activity seen during the COVID-19 economic lockdowns in 2020,” said NAR Chief Economist Lawrence Yun.
“The principal factor was the rapid increase in mortgage rates, which hurt housing affordability and reduced incentives for homeowners to list their homes. Plus, available housing inventory remains near historic lows.”
Inventory of unsold homes fell 6.6% from October to 1.14 million.
This is a 3.3 months supply at the current sales pace, unchanged from last month.
The median price for an existing home was up 3.5% YOY to $370,700.
While appreciation is moderating, prices still rose in all regions. This is the 129th consecutive month of YOY price increases, the longest streak on record.
The typical home stayed on the market for 24 days in November, up from 21 in October, while 61% of homes sold were on the market for less than a month.
Yun noted that the data suggest a thawing market, impacted by rates decreasing for the past five weeks.
The 30-year fixed rate recently fell to a three-month low, resulting in a boost in refinance applications.
However, purchase demand remains low thanks to continued stock shortages and high price appreciation.
Affordability worsened in Q4 2022 despite reduced competition and rates. The share of income required to afford homeownership has risen to 32.3%, which is considered unaffordable by traditional lending standards.
“Prospective homebuyers – especially first-time buyers – can’t seem to catch a break,” said Rick Sharga, executive vice president of market intelligence at ATTOM.
“Now that home prices have plateaued and even declined in some markets, buyers are faced with mortgage rates that have doubled, making home purchases even less affordable.”
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