US existing-home sales rise 1.5% in September to 3.99 million, beating forecasts

Centre · 1US existing-home sales rose 1.5% in September, beating expectations of a 0.8% decline, according to National Association of Realtors (NAR) data released on Tuesday 13 October. 1 Centre · 1The seasonally adjusted annual rate was 3.99 million units, against a Reuters poll of economists that expected a fall to 3.95 million; sales stayed below 4 million for a second straight month. 2 Centre · 1Part of the gain reflected a weaker August: August sales were revised to a 3.2% decline from the 2% drop first reported. Sales were still 2.2% lower than in September 2025. 2

Centre · 1By region, monthly sales rose in the South and West, were unchanged in the Midwest and fell in the Northeast; all four regions were down from a year earlier. 1 Centre · 2NAR Chief Economist Lawrence Yun said August and September were the two weakest months for home sales this year, and that recent mortgage rate increases have reduced the number of buyers who can qualify. Hindustan Times reports he described the weakness as a lack of demand rather than limited supply. 1 2 Centre · 1Freddie Mac put the average 30-year fixed mortgage rate at 7.40% last week, the highest since November 2023 and up 142 basis points since the end of February. Hindustan Times links the rise to the US-Israeli war with Iran, which began at the end of February and has added to inflation pressure and Treasury yields. It also notes the Federal Reserve raised its benchmark rate by 25 basis points to 3.75%-4.00% in September, its first hike in three years. 2

Centre · 2Inventory rose 1.9% to 1.60 million homes, the highest since November 2019 and 4.6% above a year earlier, equal to 4.8 months of supply. Oxford Economics' Nancy Vanden Houten said the rise mainly reflected homes staying on the market longer. Yun said rising inventory and longer selling times give buyers more negotiating power and that sellers may need to cut prices or offer incentives. 2 1 Centre · 1The median existing-home price rose 1.3% from a year earlier to $417,500, the highest for any September. Sales of homes priced at $1 million or more rose 4.1% year on year, while sales of lower-priced homes fell sharply. 2 Centre · 1First-time buyers made up 31% of sales, up from 30% in August and a year earlier, but below the roughly 40% NAR says a healthy market needs. Investors and second-home buyers rose to 20% of sales from 15%, cash purchases were 27% and distressed sales 2%. Median time on market was 33 days. 2

Centre · 1The outlook is weak. Only 8% of realtors surveyed expected sales to rise over the next three months, the lowest share since late 2023. BMO's Priscilla Thiagamoorthy attributed the surprise rise to delayed closings and better inventory, and warned that mortgage rates near 7.5% would keep the market subdued. Hindustan Times adds that affordability is an issue ahead of the 3 November midterm elections. 2