Sales activity in the previously owned homes market declined in August, falling 2% from the prior month to 3.98 million units on a seasonally adjusted annualized basis, according to data from the National Association of Realtors. The slowdown represented the weakest performance since June 2025 and was concentrated in the Northeast and Midwest regions. Year-over-year, sales were down 1.2%.
The decline reflects the lag between contract signing and closing, with sales in August likely stemming from agreements signed in June and July when mortgage rates were elevated. Lawrence Yun, chief economist for the Realtors organization, attributed the sales dip to the inverse relationship between mortgage rates and purchasing activity, noting that rates moved sharply higher in mid-July. However, Yun pointed out that year-to-date existing home sales through the first eight months were actually up 1.6% compared to the same period in the previous year.
Inventory conditions have shifted markedly, with housing supply reaching 1.62 million units at the end of August. This represented a 3.2% monthly increase and 5.9% annual growth, translating to a 4.9-month supply—the highest level in more than a decade. Despite this substantial increase in available properties, home prices have continued climbing, with the median sale price reaching $429,100 in August, up 1.6% from August 2025 and marking a new monthly record.
Price appreciation varied by region, with the Northeast experiencing the strongest gains despite having the lowest inventory levels. The West was the sole region recording a year-over-year median price decline. The market continues to show a split between segments, with homes priced above $1 million registering 3.9% higher sales compared to the prior year, while properties in the $100,000 to $250,000 range declined 10%. Cash purchases represented 27% of transactions, while first-time homebuyers accounted for 30% of sales. However, investors and second-home buyers comprised just 15% of August sales, down significantly from 21% a year earlier.
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