US Home Sales Rise for Third Straight Month as Rates Ease
November sales edged up 0.5% as lower mortgage rates provided a modest boost, though shrinking inventory levels pose a new challenge for buyers.
The U.S. housing market showed continued signs of stabilization in November, as existing home sales recorded their third consecutive monthly increase, largely fueled by a pullback in mortgage rates from their recent peaks.
Sales of previously owned homes rose 0.5% from October to a seasonally adjusted annual rate of 4.13 million, according to a report from the National Association of Realtors (NAR). The modest uptick marks the market's best performance since early 2025, offering a glimmer of hope after a prolonged period of sluggish activity.
"The market is responding to the decrease in mortgage rates that occurred during the autumn months," said Lawrence Yun, NAR's chief economist. He noted that the renewed buyer interest suggests a potential turning point heading into the new year, provided borrowing costs continue to cooperate.
The improvement comes as mortgage rates have retreated from 25-year highs seen earlier in the year. The decline has provided a crucial, if modest, expansion of purchasing power for potential buyers who had been sidelined by steep financing costs. This has helped put a floor under sales volume, which remains down 1% from the same period a year ago.
Despite the increase in sales, the market faces a new headwind: a shrinking supply of available properties. Total housing inventory fell by 5.9% from October to 1.43 million units. At the current sales pace, that represents a 4-month supply of homes, a tighter figure that could constrain future sales growth and prop up prices.
"With distressed property sales at historic lows and housing wealth at an all-time high, homeowners are not rushing to list their properties," Yun explained, highlighting a lock-in effect where owners are reluctant to sell and give up their low-rate mortgages.
The median price for an existing home rose 1.2% year-over-year to $409,200, marking the 29th straight month of annual price increases. However, Yun pointed to a silver lining for affordability: "Wage growth is currently outpacing home price gains, which positively impacts housing affordability."
This dynamic sets the stage for a delicately balanced 2026. Economists anticipate a market reset rather than a sharp rebound. Forecasts suggest mortgage rates may hover in the low-6% range through the spring buying season, with home prices expected to see modest appreciation between 1% and 2.5%. The key variable remains inventory. An increase in listings will be necessary to meet even slightly resurgent demand and prevent affordability from worsening once again.
For now, the three-month trend of rising sales offers a tentative signal that the housing market is finding its footing in a higher-rate environment, slowly drawing buyers back from the sidelines as they adjust to the new normal.