The upcoming presidential election might keep some would-be homebuyers on the sidelines, according to a real estate economist.
Existing-home sales declined 1% in September as prices continued to climb higher, according to figures released Wednesday by the National Association of Realtors.
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – receded 1% from August to a seasonally adjusted annual rate of 3.84 million in September. Year-over-year, sales fell 3.5%, down from 3.98 million in September 2023.
“Home sales have been essentially stuck at around a four-million-unit pace for the past 12 months, but factors usually associated with higher home sales are developing,” NAR Chief Economist Lawrence Yun said. “There are more inventory choices for consumers, lower mortgage rates than a year ago and continued job additions to the economy.”
Yun said the upcoming election could be a factor.
“Perhaps, some consumers are hesitating about moving forward with a major expenditure like purchasing a home before the upcoming election,” he said.
Total housing inventory at the end of September was 1.39 million units, up 1.5% from August and 23% from one year ago (1.13 million). At the existing sales pace, unsold inventory stands at a 4.3-month supply, up from 4.2 months in August and 3.4 months in September 2023. A six-month supply is generally considered a balanced market.
“More inventory is certainly good news for home buyers as it gives consumers more properties to view before making a decision,” Yun said. “However, the inventory of distressed properties is minimal because the mortgage delinquency rate remains very low. Distressed property sales accounted for only 2% of all transactions in September.”
The median existing home price for all housing types in September was $404,500, up 3% from one year ago when it was $392,700.
“Moderating home price increases are welcome news for home buyers,” Yun added. “With wage growth now outpacing home price appreciation, housing affordability will improve.”
The 30-year fixed-rate mortgage averaged 6.44% as of Oct. 17, according to Freddie Mac. That’s up from 6.32% one week ago but down from 7.63% one year ago.
