LOS ANGELES – Sales of previously occupied U.S. homes fell to a nearly 30-year low in 2024 for the second time in as many years as elevated mortgage rates, rising home prices and the low number of properties on the market keep would-be homebuyers out of the market .
The National Association of Realtors said Friday that sales of existing U.S. homes totaled 4.06 million last year, down 0.7% from 2023. That's the weakest year for home sales since 1995 and mirrors 2023's full-year results.
The median national home price rose 4.7% throughout last year to an all-time high of $407,500, according to the NAR.
The U.S. housing market has been in a sales slump since 2022, when mortgage rates began rising from pandemic-era lows. The average interest rate on a 30-year mortgage rose to a 23-year high of nearly 8% in October 2023 and briefly fell to a 2-year low last September, but has mostly hovered around 7%, according to mortgage buyer Freddie Mac a .
The increased borrowing costs for home loans, in addition to prices that have been rising for years, have limited the purchasing power of property seekers. The lack of homes for sale, meanwhile, has helped support prices and keep many home buyers and sellers at bay.
At the end of December, there were just 1.15 million homes on the market, NAR said. This is well below the historical monthly average of around 2.25 million.
The available inventory at the end of last month amounts to 3.3 months supply based on the current sales pace. In a more balanced market between buyers and sellers, there is a 4 to 6 month supply.
Home sales in December rose a seasonally adjusted 2.2% from the previous month to 4.24 million annually. That's the third straight monthly sales increase and exceeds the 4.2 million forecast by analysts surveyed by FactSet.
Sales rose 9.3% in December compared to the same month last year.
The median home sales price rose for the 18th straight month in December to $404,000, up 6% from a year ago.