Existing-home sales fell 2.0% in August to a seasonally adjusted annual rate of 3.98 million, the slowest pace for the month in more than ten years, according to the National Association of Realtors’ latest report. Sales are also down 1.2% from a year ago, and the number of homes sitting unsold has climbed to its highest level in over a decade.
Inventory Is Piling Up Fast
Total housing inventory reached 1.62 million units by the end of August, up 3.2% from July and up 5.9% from a year earlier. At the current sales pace, that works out to 4.9 months of supply — the highest reading NAR has recorded in more than ten years, and a level that generally favors buyers over sellers. A balanced market is traditionally considered to sit around five to six months of supply, so August’s numbers put the market right at the edge of tipping in buyers’ favor nationally, even though plenty of individual metro areas remain tighter.
NAR Chief Economist Lawrence Yun tied the sales slowdown directly to borrowing costs. “Mortgage rates and home sales move in opposite directions, so it’s not surprising to see a mild dip in home buying activity due to high mortgage rates,” Yun said, adding that the swelling inventory is “giving homebuyers better opportunities to negotiate.”
Prices Climbed Anyway
Despite softer sales, the median existing-home price rose to $429,100 in August, up 1.6% from a year earlier. Single-family home prices rose 1.7% year-over-year to $434,800, while condos and co-ops climbed a more modest 1.5% to $371,600. Single-family sales alone fell 1.9% month-over-month to a 3.62 million annual rate, and condo and co-op sales dropped 2.7% to 360,000 units — both segments moving in the same direction even as their price paths diverged slightly.
What More Negotiating Room Actually Looks Like
For buyers who have been priced out or outbid over the past few years, a near-five-month supply changes the calculus in small but real ways: more room to ask for repairs, more listings that sit long enough to accept a price cut, and fewer bidding wars on the homes that do move. It doesn’t mean prices are falling — August’s median is still higher than a year ago — but it does mean sellers are increasingly the ones adjusting expectations rather than the reverse. NAR’s full release notes that the shift has been building gradually over several months rather than arriving all at once in August.