US Existing-Home Sales Fell 8.4% in January
Sales of existing homes in the U.S. decreased by 8.4% in January, according to a new report from the National Association of Realtors. Despite the drop in sales volume, the report noted that housing affordability improved for the seventh consecutive month.
- The January sales decline brought the seasonally adjusted annual rate of existing-home sales to 3.91 million, the slowest pace in over two years. This was a much larger drop than the 3.5% decrease that economists had predicted. - Despite the slowdown in sales, the median price for an existing home rose to $396,800, a 0.9% increase from January 2025. This marks the 31st consecutive month of year-over-year price increases. - Total housing inventory at the end of January was 1.22 million units, which is a slight decrease of 0.8% from December but an increase of 3.4% from one year ago. This represents a 3.7-month supply of unsold homes at the current sales pace. - NAR's Chief Economist, Dr. Lawrence Yun, suggested that unusually cold temperatures and higher-than-normal precipitation in January may have contributed to the disappointing sales figures. - The improvement in housing affordability is attributed to wage gains growing faster than home prices and mortgage rates being lower than they were a year ago. The NAR's Housing Affordability Index increased to 116.5 in January, its highest level since March 2022. - All four major U.S. regions saw a decline in both month-over-month and year-over-year sales. The West experienced the most significant drop in sales despite not being affected by severe weather. - First-time homebuyers accounted for 31% of sales in January, an increase from 29% in December and 28% one year ago.
