Existing home sales in the United States hit a 16-year low in October as buyers were driven out by record mortgage rates and rising inflation, according to new data released Wednesday.
Sales of already-built units fell to 3.75 million in October, an 8.8% decline from last year, the National Association of Realtors (NAR) reported. The median sales price of existing homes increased slightly to $416,700. Sales declines were seen in the Midwest, South and West, although sales in the Northeast remained stable.
Mortgage rates have fallen steadily in 2024 and 2025, with the 30-year rate falling below 6% for the first time in February 2026. But rising inflation and rising interest rates amid the Iran war have pushed rates to their highest level in nearly three years.
The 30-year mortgage rate, which is the most commonly used rate for home loans, now hovers around 7.18%, not far from its 2023 high of 7.79%. During the pandemic, average mortgage rates were just above 3%.
“Buying a home is tough as mortgage rates hit their highest levels since 2000, except for a single month in 2023,” Lawrence Yun, chief economist at NAR. “As a result, home sales fell to their lowest level since August 2010.”
Pending home sales, or the number of contracts signed before closing, hit their lowest levels in NAR history in September, the same month the 30-year mortgage rate topped 7% for the first time in nearly two years.
Mortgage rates have been directly affected by interest rate changes from the U.S. Federal Reserve, which raised interest rates in September for the first time since 2023. Rates are currently in a range of 3.75% to 4%.
The central bank is set to raise rates again next month to combat rising inflation, which rose more than expected in October.
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Concerns about affordability and cost of living played an outsized role in the midterm elections that gave Democrats control of Congress the next year. Median rent growth in the United States has outpaced inflation, according to the latest census data. The homeownership rate in the United States has stagnated since 2021, according to the same data.
“I don’t think this is a new normal for home sales,” said Danielle Hale, chief economist at Realtor.com. “Instead, it reflects a perfect storm of abrupt change in the financial environment and great uncertainty in the pre-election period, both for politics and the economy, just when the housing market usually slows for the season.”
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