Existing Sales Down Monthly, Up YOY In January

Existing home sales declined for the month but saw an annual spike in January.

Sales fell 4.9% to a seasonally adjusted annual rate of 4.08 million, adding to December’s 2.2% decline, according to the National Association of Realtors.

They were up 2% from the year prior, however, the fourth consecutive YOY gain.

All major regions experienced declines except for the Midwest, which saw no change. Year-over-year, sales rose in three regions and were unchanged in the South.

“Mortgage rates have refused to budge for several months despite multiple rounds of short-term interest rate cuts by the Federal Reserve,” said NAR Chief Economist Lawrence Yun. “When combined with elevated home prices, housing affordability remains a major challenge.”

The median existing price was $396,900, up 4.8% annually. All four regions posted price increases.

Total housing inventory at the end of December was 1.18 million units, up 3.5% from December and 16.8% YOY. This is a 3.5-month supply at the current sales pace.

However, new home purchase demand waned in 2024, as many consumers remain priced out of the market. Yun noted that lower rates would draw in a bigger pool of potential buyers.

Zonda’s new home market ranking slipped from a “slightly overperforming” reading to “average” as the pool of home shoppers who can afford to buy meet plentiful new construction.

“If there’s one word to describe the new home market today, it would be ‘fine,'” Ali Wolf, chief economist at Zonda, commented.

“Traffic is low, and buyers lack any sense of urgency, but reasonable conversion rates show that serious buyers are still out and about.”