US existing home sales rose 1.5% in September to a seasonally adjusted annual rate of 3.99 million, beating the 3.95 million estimate. Sales still fell in every region from a year earlier, and higher mortgage rates continue to limit buyers.
US existing home sales rose 1.5% in September to an annualized rate of 3.99 million, against a 3.95 million estimate. The prior month stood at 3.98 million.
Gains in the South and West, declines elsewhere
The South and West drove the monthly gain, each up 2.8%. Sales were unchanged in the Midwest and fell 2.1% in the Northeast.
Compared with a year earlier, however, sales declined 2.2% nationally from 4.08 million, and every region posted a drop. The West recorded the largest annual decline at 5.2%.
The national median price fell 2.4% from August to $417,500, though it was up 1.3% year over year. These figures are not seasonally adjusted, so monthly declines can reflect normal seasonal patterns.
Mortgage rates weigh on buyers
NAR Chief Economist Lawrence Yun said that August and September marked the two slowest months for home sales this year. According to Reuters, he added that further increases in mortgage rates "mean fewer buyers can qualify to purchase a home."
The 30-year fixed mortgage rate averaged 7.40% last week, the highest level since November 2023, according to Freddie Mac data cited by Reuters. Reuters reported that the US-Israeli war with Iran is fanning inflation and boosting US Treasury yields, which mortgage rates track.
Inventory rises and buyers gain leverage
Existing housing inventory rose 1.9% to 1.60 million units, the highest level since November 2019. At September's sales pace, it would take 4.8 months to exhaust that supply.
Higher inventory and longer selling times give buyers more negotiating power, though financing remains a hurdle.
Sources: Investinglive, Reuters via Investing.com
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