U.S. Existing-Home Sales Plunge 5.5% to Lowest Level Since 2010

Sales of previously owned U.S. homes fell 5.5% in October, pushing the market to its slowest pace in more than 16 years as higher mortgage rates kept many prospective buyers on the sidelines. The National Association of Realtors (NAR) reported a seasonally adjusted annual sales rate of 3.75 million, the lowest since August 2010.

October’s decline followed a modest increase in September and left sales 8.8% below their level a year earlier. The weakness was widespread: activity fell across three of the country’s four major regions, and every region recorded fewer sales than in October 2025. Yet home prices continued to edge higher nationally, highlighting the gap between subdued sales and the limited relief available to buyers on affordability.

Existing-home sales measure completed purchases of previously owned single-family houses, townhouses, condominiums and cooperative apartments. The reported 3.75 million figure is an annualized pace adjusted for seasonal patterns, not the number of homes sold during October itself. It is an important distinction when comparing one month’s activity with a full year’s housing market.

Mortgage rates reverse earlier affordability gains

The sharp slowdown coincided with renewed pressure from borrowing costs. NAR said the average rate on a 30-year fixed mortgage was 7.33% in October, compared with 6.86% in September and 6.25% a year earlier. Such a change affects not only the monthly payment a buyer faces but also how much a household can borrow while staying within a lender’s qualification limits.

Freddie Mac’s mortgage survey archive shows that the weekly 30-year fixed rate rose to 7.40% in mid-October before easing to 7.24% by October 29. Those weekly readings help explain why the monthly rate remained elevated even as borrowing costs began to retreat late in the month. They should not be confused with the rates paid by every borrower, which vary with credit, loan terms and other factors.

NAR chief economist Lawrence Yun linked the drop in sales to the cost of home financing. He noted that mortgage rates had reached their highest levels since 2000, apart from one month in 2023. His assessment points to a market where many households may want to move but cannot make the payments work at current rates. The October data establish a clear slowdown in completed sales, although they do not isolate how much of the decline was caused by rates rather than other factors.

September sales had risen 1.5% to an annual rate of 3.99 million, according to NAR’s preceding release. The subsequent decline therefore erased that gain and carried the market below the already weak levels seen earlier in the year. Because existing-home sales count closings rather than newly signed purchase contracts, the figures also reflect buying decisions made before October.

Inventory grows, but prices continue to rise

More homes were available for purchase even as fewer sales closed. Unsold inventory stood at 1.59 million properties at the end of October, 4.6% more than a year earlier. At the latest sales pace, that represented a 5.1-month supply, compared with 4.4 months a year earlier.

A growing months’ supply can give buyers more time to compare homes and negotiate, although the national measure masks considerable differences among local markets. Inventory growth also does not automatically translate into lower prices. The median existing-home sale price was $416,700 in October, 0.4% higher than the $414,900 recorded a year earlier. NAR said that marked 40 consecutive months of year-over-year price increases.

The modest national price gain contrasts with the much steeper fall in sales volume. Fewer completed sales do not necessarily mean that sellers are cutting prices broadly: the types, sizes and locations of homes that actually sell can change from one month to another. The median reflects the middle sale price, not the change in value of a constant set of houses. Annual comparisons are generally more useful than unadjusted month-to-month movements in that figure.

Homes also took somewhat longer to find buyers. The median time on the market reached 35 days, compared with 33 days in September and 34 days a year earlier. First-time buyers accounted for 29% of October purchases, down from 31% a month earlier and 32% a year ago. Those figures are consistent with the particular difficulty faced by buyers who must finance a purchase without proceeds from selling an existing property.

Cash purchases represented 29% of sales, up from 27% in September, while individual investors and second-home buyers made up 20% of purchases, versus 16% a year earlier. These are shares of a smaller market, so a higher percentage does not by itself establish that the absolute number of such purchases increased. Distressed sales, including foreclosures and short sales, remained at just 2% of purchases, offering little evidence of a broad wave of forced selling.

Western states lead the decline

Regional figures show the greatest month-to-month retreat in the West, where sales fell 9.7% to an annual rate of 650,000. Activity there was down 14.5% from a year earlier, the largest annual decline among the four regions. The West also had the highest regional median sale price at $624,300, unchanged from October 2025. Its high prices and expensive financing illustrate why small changes in mortgage rates can have an outsized effect on affordability in costly markets.

Sales in the South declined 6.5% to 1.73 million annually, while the Midwest registered a 3.2% decrease to 900,000. The Northeast was the exception to the monthly slide, with sales holding steady at 470,000. Even there, completed purchases were down 4.1% from a year earlier, so flat monthly activity did not signal a full recovery.

Price trends were not uniform. The median price rose 3.2% from a year earlier in the Northeast to $519,600 and increased 1.5% in the Midwest to $324,300. The South recorded a 0.4% decline to $360,900. Differences in regional pricing underline why the national median alone is an incomplete measure of conditions for buyers looking in a particular city or state.

Single-family sales, which account for most of the market, fell 5.8% from September to an annual rate of 3.41 million. Condominium and co-op sales slipped 2.9% to 340,000 annually. Both categories also experienced annual declines, reinforcing that the slowdown was not confined to one type of property.

Housing demand depends on financing relief

In its October sales release, NAR described a market with substantial potential demand but restricted access to affordable financing. Yun argued that many existing owners remain financially secure because of gains in housing wealth, with relatively few distressed properties reaching the market. That helps explain why falling sales have not produced a comparable national decline in selling prices.

There is a further constraint for existing owners considering a move: a purchase of another home may require giving up an older mortgage with a much lower rate. This can discourage listings and limit mobility even when households would otherwise prefer to relocate. It is a plausible market mechanism rather than a separate measured finding from October’s sales report.

Some easing in weekly mortgage rates appeared by early November. Freddie Mac recorded a 7.18% average for the 30-year fixed rate on November 5, down from the October readings but still above the 6.22% recorded at the same time a year earlier. Whether that improvement will be enough to draw more buyers into the market cannot be established from October closings alone.

The next forward-looking signal will come from NAR’s October pending-home-sales report, scheduled for November 18. Because that index tracks signed contracts rather than completed purchases, it may offer a more immediate indication of whether demand began to recover as mortgage rates eased toward the end of October.