Existing home sales fell 5.9 percent last month, the lowest level since December 2011 outside the first days of the pandemic.
Existing home sales in the US fell for the ninth straight month in October as the 30-year fixed rate hit a 20-year high and prices continued to rise, putting many Americans out of reach for homeownership.
Existing home sales fell 5.9 percent to an annualized 4.43 million units last month, the National Association of Realtors said Friday. Outside of the fall during the first phase of the COVID-19 pandemic in early 2020, this was the lowest since December 2011.
Economists polled by Reuters had forecast home sales to fall to 4.38 million.
Home sales, which make up the bulk of US sales, fell 28.4 percent year over year in October. The report followed Thursday’s news that new single-family home construction and future building permits were down the most since May 2020. Home searches also fell.
Mortgage rates have risen due to inflation, which has forced the Federal Reserve to raise interest rates the fastest since the 1980s. 30-year fixed-rate mortgages broke 7 percent in October for the first time since 2002, according to data from housing finance agency Freddie Mercury. Mac. The figure rose 6.61 percent in the previous week.
Existing home sales fell sharply in all four regions.
Although demand is slowing, the supply of housing remains strong, mitigating the decline in home prices.
The median price of an existing home rose 6.6 percent from a year earlier to $379,100 in October. This marked 128 straight months of year-over-year home price increases, the longest streak on record. There were 1.22 million homes already on the market, down 0.8 percent from September and a year ago.
For October sales, it will take 3.3 months to list available homes, up from 2.4 months a year ago. A supply of four to seven months seems to be a good balance between supply and demand.
Goods are usually on the market for 21 days last month, up from 19 days in September. Sixty-four percent of homes sold in October 2022 were on the market for less than a month.
First-time buyers accounted for 28 percent of purchases, down from 29 percent in September and a year ago. Gross sales made up 26 percent of transactions, up from 24 percent a year ago.
