Sales of existing homes slipped 4.9% in January, but year-over-year sales were up 2% as high prices and mortgage rates keep some potential buyers on the sidelines, including first-time buyers.
Existing home sales retreated in January, the National Association of Realtors said Friday. Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – dropped 4.9% from December to a seasonally adjusted annual rate of 4.08 million in January. Year-over-year, sales gained 2% (up from 4 million in January 2024).
“Mortgage rates have refused to budge for several months despite multiple rounds of short-term interest rate cuts by the Federal Reserve,” NAR Chief Economist Lawrence Yun said. “When combined with elevated home prices, housing affordability remains a major challenge.”
Total housing inventory at the end of January was 1.18 million units, a 3.5% increase from December and up 16.8% from one year ago (1.01 million). Unsold inventory stood at a 3.5-month supply at the current sales pace, up from 3.2 months in December and 3 months in January 2024. A six-month supply is generally considered a balanced market.
