Please ensure Javascript is enabled for purposes of website accessibility
US Home Sales Slowed in September to Weakest Pace in Nearly 14 Years
gvw_ap_news
By Associated Press
Published 1 week ago on
October 23, 2024

US home sales hit a 14-year low in September, despite easing mortgage rates and increasing inventory. (AP/David Zalubowski)

Share

Getting your Trinity Audio player ready...

LOS ANGELES — Sales of previously occupied U.S. homes slowed in September to the weakest annual pace in nearly 14 years even as mortgage rates eased and the supply of properties on the market continued to climb.

Existing home sales fell 1% last month, from August, to a seasonally adjusted annual rate of 3.84 million, the National Association of Realtors said Wednesday. That marks the second straight monthly decline and the slowest annual sales pace since October 2010 when the housing market was still in a deep slump following the late-2000s real estate crash.

Sales fell 3.5% compared with September last year. On a regional basis, sales fell in the Northeast, South and Midwest last month from a year earlier, but rose in the West.

Overall, the latest home sales were short of the 3.9 million pace economists were expecting, according to FactSet.

“The factors that would drive higher home sales —- such as mortgage rates meaningfully lower now compared to one year ago, inventory beginning to increase and, of course, jobs continuously being added to the economy —- and yet home sales are stuck at low levels,” said Lawrence Yun, the NAR’s chief economist.

Home Prices Continue to Rise Despite Slower Sales

Despite the slower sales pace, home prices increased on an annual basis for the 15th consecutive month. The national median sales price rose 3% from a year earlier, to $404,500.

While the rate of price growth has been slowing, the latest median sales price is 49% higher than it was five years ago, before the pandemic. By comparison, wages grew 25% in the same period, Yun noted.

Years of soaring home prices have helped put homeownership out of reach of many Americans, making housing a key political issue for voters in next month’s election.

Mortgage Rates and Housing Market Outlook

The U.S. housing market has been in a sales slump dating back to 2022, when mortgage rates began to climb from pandemic-era lows. Existing home sales sank to a nearly 30-year low last year as the average rate on a 30-year mortgage surged to a 23-year high of nearly 8%, according to mortgage buyer Freddie Mac.

Mortgage rates mostly eased since July in anticipation of last month’s move by the Federal Reserve to cut its main interest rate for the first time in more than four years and to signal further cuts through 2026. While the central bank doesn’t set mortgage rates, its policy pivot cleared a path for mortgage rates to generally go lower.

The average rate on a 30-year mortgage fell to 6.08% four weeks ago — its lowest level in two years — but has edged higher since then, reaching 6.44% last week.

“Falling mortgage rates in July and August were expected to bring more buyers into the market, but some home shoppers may be holding out for rates to fall further,” said Lisa Sturtevant, chief economist at Bright MLS. “Others may be taking a wait-and-see approach in the lead up to the presidential election.”

Economists generally expect mortgage rates to remain near their current levels, at least this year. Fannie Mae projects the rate on a 30-year mortgage will average 6.2% in the October-December quarter and decline to an average of 5.7% in the same quarter next year.

Inventory Rises as Sales Slow

As sales have slowed, the inventory of homes for sale has kept ticking higher. There were 1.39 million unsold homes at the end of September, up 1.5% from August and 23% from September last year, NAR said.

That translates to a 4.3-month supply at the current sales pace, up from a 3.4-month pace at the end of September last year. Traditionally, a 5- to 6-month supply is considered a balanced market between buyers and sellers.

Another factor helping lift the inventory of homes on the market: Properties are taking longer to sell than a year ago.

Homes typically stayed on the market for 28 days last month before they were sold, up from 21 days a year earlier.

“Even with the recent increase in inventory one can say that’s helping loosen up the market, but it’s still far short of what would be considered a more normal inventory level,” Yun said.

Still, in a plus for home shoppers, fewer homes are receiving multiple offers. Some 20% of the homes that sold last month were bought for more than their original list price, down from 26% in September last year.

First-time homebuyers who don’t have any home equity to put toward their down payment continue to have a tough time getting into the housing market. They accounted for just 26% of all homes sold last month, matching the all-time low from August. It was down from 27% in September last year. They’ve accounted for 40% of sales historically.

Homebuyers who can afford to sidestep mortgage rates and pay all cash for a home accounted for 30% of sales last month, up from 29% a year earlier.

RELATED TOPICS:

DON'T MISS

Fresno State Bulldogs Stumble in Fourth Quarter, Suffer Narrow Loss to Hawai’i

DON'T MISS

From Blue Cheese to Bacon: Peanut Butter Pairings That Will Shock You

DON'T MISS

Challengers Seek Seats on Tulare County Irrigation District Boards

DON'T MISS

Shy Pup Finds Hope with Foster Family, Evasion from Euthanasia

DON'T MISS

Does Dill Have Magical Powers? What People Once Believed Food Could Do

DON'T MISS

Let’s Keep Innovative Partnerships Crucial to Combating Climate Change: Fresno Dairy Manager

DON'T MISS

Immediate Threat: Mussel Invades California’s Delta, First Time in North America

DON'T MISS

Two-Time Cy Young Winner Blake Snell Opts Out of Contract with Giants

DON'T MISS

No Matter the Outcome, We Are the True Losers of This Election

DON'T MISS

Russia’s Swift March Forward in Ukraine’s East

UP NEXT

From Blue Cheese to Bacon: Peanut Butter Pairings That Will Shock You

UP NEXT

Challengers Seek Seats on Tulare County Irrigation District Boards

UP NEXT

Shy Pup Finds Hope with Foster Family, Evasion from Euthanasia

UP NEXT

Does Dill Have Magical Powers? What People Once Believed Food Could Do

UP NEXT

Let’s Keep Innovative Partnerships Crucial to Combating Climate Change: Fresno Dairy Manager

UP NEXT

Immediate Threat: Mussel Invades California’s Delta, First Time in North America

UP NEXT

Two-Time Cy Young Winner Blake Snell Opts Out of Contract with Giants

UP NEXT

No Matter the Outcome, We Are the True Losers of This Election

UP NEXT

Russia’s Swift March Forward in Ukraine’s East

UP NEXT

Rapper Young Thug Is a Free Man. Here Are Things to Know About His Plea.

Shy Pup Finds Hope with Foster Family, Evasion from Euthanasia

14 hours ago

Does Dill Have Magical Powers? What People Once Believed Food Could Do

15 hours ago

Let’s Keep Innovative Partnerships Crucial to Combating Climate Change: Fresno Dairy Manager

16 hours ago

Immediate Threat: Mussel Invades California’s Delta, First Time in North America

1 day ago

Two-Time Cy Young Winner Blake Snell Opts Out of Contract with Giants

1 day ago

No Matter the Outcome, We Are the True Losers of This Election

1 day ago

Russia’s Swift March Forward in Ukraine’s East

1 day ago

Rapper Young Thug Is a Free Man. Here Are Things to Know About His Plea.

1 day ago

AMOR Wellness Trunk-or-Treat Brings 700 Mendota Residents Together for Halloween Fun

1 day ago

What Kind of Trouble Is Miguel Arias Trying to Stir Up This Time?

1 day ago

Fresno State Bulldogs Stumble in Fourth Quarter, Suffer Narrow Loss to Hawai’i

Game-Defining Play:  Pass interference call on Fresno State’s defense in the fourth quarter that lead to the game winning touchdown fo...

39 mins ago

39 mins ago

Fresno State Bulldogs Stumble in Fourth Quarter, Suffer Narrow Loss to Hawai’i

14 hours ago

From Blue Cheese to Bacon: Peanut Butter Pairings That Will Shock You

14 hours ago

Challengers Seek Seats on Tulare County Irrigation District Boards

14 hours ago

Shy Pup Finds Hope with Foster Family, Evasion from Euthanasia

15 hours ago

Does Dill Have Magical Powers? What People Once Believed Food Could Do

16 hours ago

Let’s Keep Innovative Partnerships Crucial to Combating Climate Change: Fresno Dairy Manager

1 day ago

Immediate Threat: Mussel Invades California’s Delta, First Time in North America

1 day ago

Two-Time Cy Young Winner Blake Snell Opts Out of Contract with Giants

Search

Send this to a friend