Existing-home sales end 2024 on the rise

Existing-home sales gained ground again in December 2024, rising 9.3 percent year-over-year, the National Association of Realtors (NAR) reports. The median home sale price was $404,400.

“Home sales in the final months of the year showed solid recovery despite elevated mortgage rates,” says Lawrence Yun, chief economist at NAR. “Home sales during the winter are typically softer than the spring and summer, but momentum is rising with sales climbing year-over-year for three straight months. Consumers clearly understand the long-term benefits of homeownership. Job and wage gains, along with increased inventory, are positively impacting the market.”

High mortgage rates have contributed to sluggish home sales, with the average 30-year fixed mortgage rate rising from a low of 6.2 percent in September to 7.06 percent as of Jan. 22, according to Bankrate’s survey of large lenders.

With home prices historically high, affordability challenges remain daunting for homebuyers. Lower mortgage rates would relieve some of that pain — but they also could lure more buyers into the market, furthering fueling prices.

“The fate of the housing market in the coming months will be dictated in part by the direction of mortgage rates, as well as the health of the broader economy,” says Mark Hamrick, Bankrate’s senior economic analyst. “The market could benefit from a combination of tailwinds, if they were to develop and are sustained.”

Existing-home sales tick up

The count of existing-home sales includes all completed resales, including single-family houses, condos, townhouses and co-ops. According to NAR, the number of sales nationally increased from the previous month to an annual pace of 4.24 million transactions in December.

In December, existing-home sales in the Northeast increased 3.9 percent from November to an annual rate of 530,000, up 10.4 percent from December of last year. In the Midwest, sales contracted 1 percent from November to an annual rate of 990,000, but were still up 6.5 percent from last year. Sales in the South rose 3.2 percent from November to an annual rate of 1.93 million, up 9 percent from the prior year In the West, sales from November were up 2.6 percent to annual rate of 790,000, up 12.9 percent from a year ago.

Days on market

Properties typically remained on the market for 35 days in December, up from 32 days in November and 29 days in December 2023. Selling times are a crucial measure at any time of year, but especially during the peak spring and summer selling seasons.

Home prices still high

The nationwide median sale price for existing homes in December was $404,400. That’s below June’s all-time high of $426,900, mostly due to seasonality, but it’s still an increase of 6 percent from last year. This marks 18 consecutive months of year-over-year price increases.

Home prices were up year-over-year in all four regions. The median price in the Northeast was $478,900, up 11.8 percent from last year. In the Midwest it was $298,600, up 9 percent, and in the South it was $361,800, up 3.4 percent from one year earlier. The median price in the West remains the highest by far at $614,500, up 6 percent from December 2023.

First-time homebuyers made up 31 percent of sales in December, an improvement over the all-time low of 26 percent in August and September. Cash sales accounted for 28 percent of all transactions in December, up from 25 percent the month prior but down from 29 percent the previous year.

Supply again improves year-over-year

The supply of homes for sale has been inching higher after hitting record lows during the pandemic. Total housing inventory at the end of December was 1.15 million units, down 13.5 percent from November but up a healthy 16.2 percent from one year ago, when it was 990,000. Unsold inventory sits at a 3.3-month supply at the current sales pace, down from 3.8 months in November but up from 3.1 months in December 2023.