AI Generated Image
Home sales dropped last month as mortgage rates reached highest level in over a year
finance.yahoo.com • • general
Key Points:
- Existing home sales declined by 2% in August to a seasonally adjusted annual rate of 3.98 million, marking the slowest pace in over a year and a 1.2% drop from last August, according to the National Association of Realtors (NAR).
- Mortgage rates reached their highest levels in over a year, fluctuating between 6.6% and 6.7% in August and hitting 6.71% recently, which has discouraged many prospective buyers and contributed to the sales decline.
- Sales fell in all U.S. regions except the West, with the Northeast experiencing the largest drop at 4%, amid ongoing affordability challenges despite low housing supply and rising home prices, with the median home price up 1.6% year-over-year to $429,100.
- Despite recent declines, home sales in 2026 remain slightly ahead of 2025’s total due to lower mortgage rates earlier in the year, with a 1.6% increase in sales through August compared to the previous year.
- NAR Chief Economist Lawrence Yun noted that rising mortgage rates and bond yields negatively impact short-term home sales prospects, reflecting the inverse relationship between home sales and mortgage rates.
