Sales of previously owned U.S. homes fell sharply in October to their lowest level in more than 16 years, as rising mortgage rates squeezed buyers already struggling with high prices.
Existing-home sales dropped 5.5 percent from September to a seasonally adjusted annual rate of 3.75 million, the National Association of Realtors said Thursday. Economists surveyed by The Wall Street Journal had expected a 3.8 percent decline.
The sales pace was the weakest since August 2010, when the housing market was still struggling in the aftermath of the financial crisis. The monthly decline was the largest since January. Sales were down 8.8 percent from a year earlier, the biggest annual decrease since 2023.
The average rate on a 30-year fixed mortgage rose to 7.33 percent in October from 6.86 percent in September and 6.25 percent a year earlier, according to Freddie Mac figures cited by NAR.
October’s completed sales largely reflect contracts signed in September. The further increase in borrowing costs last month threatens to weigh on coming sales.
Prices offered buyers little relief. The national median existing-home price rose 0.4 percent from a year earlier to $416,700.
Inventory increased even as sales declined. There were 1.59 million homes available at the end of October, up 1.3 percent from September and 4.6 percent from a year earlier. That represented 5.1 months of supply at the current sales pace, compared with 4.7 months in September and 4.4 months a year earlier.
Sales fell across three of the four major regions, led by a 9.7 percent decline in the West. The South posted a 6.5 percent decrease, while Midwest sales dropped 3.2 percent. Sales in the Northeast were unchanged.
The pullback extended across price brackets. Supplemental NAR figures showed single-family sales below year-earlier levels in every price category, including a 12.2 percent decline for homes priced between $500,000 and $750,000 and a 6.6 percent decrease for homes costing more than $1 million.
Distressed transactions, including foreclosures and short sales, remained just 2 percent of sales.
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