Existing-home sales break five-month string of declines by posting a positive November.
After five months of disappointing existing-home sales numbers, November finally posted a positive month, with a 0.8% increase according to the National Association of Realtors® (NAR). This is especially encouraging because this was before the major mortgage rate drops we’ve seen in the last few weeks, and included closings of contracts that were signed when mortgage rates were still at a two-decade high in October.
"The latest weakness in existing home sales still reflects the buyer bidding process in most of October when mortgage rates were at a two-decade high before the actual closings in November," said NAR Chief Economist Lawrence Yun. "A marked turn can be expected as mortgage rates have plunged in recent weeks."
Pulling out positive trends from the data
The existing-home sale story was notably different depending on which part of the country you live in, however. Closings were down in two out of the four major regions in the U.S. in November. Overall, existing-home sales in November were at a seasonally-adjusted annual rate of 3.82 million, and year-over-year, sales were down 7.3% from November 2022. That’s quite an improvement on the 14.6% year-over-year drop in last month’s numbers.
Here’s how the numbers broke out by region:
- Northeast: Down 2.1%, an annual rate of 470,000, down 13.0% from November 2022
- Midwest: Up at 1.1% to an annual rate of 940,000, down 8.7% from November 2022
- South: Up 4.7% to an annual rate of 1,770,000, down 4.3% from November 2022
- West: Down 7.2% with an annual rate of 640,000, down 8.6% from November 2022
November also saw some positive trends for first-time homebuyers. They were responsible for 31% of sales in November, up from 28% in October 2023 and the same amount as a year ago. All-cash sales made up 27% of transactions in November, down from 29% in October but up from 26% last year. Individual investors or second-home buyers were responsible for 18% of home sales, down from 15% in October and 14% from a year ago.
Inventory and affordability remain a concern
Total housing inventory slid 1.7% in November after two months of gains. November saw 1.13 million housing units, which was up 0.9% from one year ago (1.12 million). This represents a 3.5-month supply at the current sales pace, down from last month but up from 3.3 months in November 2022.
Home prices continue to inch up year-over-year, but came down from last month during this part of the year known for a drop in homebuying interest. The median existing-home price came in at $387,600, down from last month but up 4.0% from last year.
"Home prices keep marching higher," Yun added. "Only a dramatic rise in supply will dampen price appreciation."
Month | Median existing-home price | Month-over-month | Year-over-year |
$370,700 | Down 2.2% | Up 3.5% | |
$366,900 | Down 1.0% | Up 2.3% | |
$359,000 | Down 2.2% | Up 1.3% | |
$363,000 | Up 1.1% | Down 0.2% | |
$375,700 | Up 3.5% | Down 0.9% | |
$388,800 | Up 3.5% | Down 1.7% | |
$396,100 | Up 1.9% | Down 3.1% | |
$410,200 | Up 3.6% | Down 0.9% | |
$406,700 | Down 0.9% | Up 1.9% | |
$407,100 | Up 0.1% | Up 3.9% | |
$394,300 | Down 3.1% | Up 2.8% | |
$391,800 | Down 0.6% | Up 3.4% | |
November | $387,600 | Down 1.1% | Up 4.0% |
As we keep an eye on mortgage rates, which have been on a downward trajectory in December, it’s important to keep an eye on home prices as well. Lower mortgage rates could lead to higher demand, which may push home prices even higher.
That’s why it’s important to work with a local loan officer, or get started by getting pre-approved for a mortgage in just a few minutes.
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