The National Association of REALTORS (NAR) reports that existing-home sales increased in December. Three main U.S. areas had an increase in sales, while the Midwest saw a decline. All four regions saw an increase in sales year over year.
The median price hit a new high of $407,500 in 2024, while existing-home sales (4.06 million) fell to their lowest level since 1995 on an annual basis.
“Existing home sales improved in December, rising 2.2% to a pace of 4.24 million home sales,” Danielle Hale, Chief Economist at Realtor.com. “Importantly, this was a third straight year-over-year gain after a streak of declines stretching back to August 2021, and a sizable uptick of 9.3%. Mortgage rates were already climbing higher in October and November when these homes with December closings generally went under contract. While some December buyers likely rushed to close before mortgage rates surged even higher, others may have simply acclimated to a new, and higher, normal. As mortgage rates have remained relatively high, home sales in the months ahead will indicate which is the bigger factor.”
While the improvement is something to celebrate, the December data caps a year where home sales did not live up to expectations. In fact the annual sales total for 2024 was 4.06 million, down from 4.09 million in 2023, marking the most sluggish year for existing home sales since 1996. The strength of the December uptick will be tested in the months ahead, but does open the possibility that the bottom in existing home sales is truly in the rearview mirror.
Examining U.S. Home Sale Trends
Completed transactions involving single-family homes, townhomes, condominiums, and cooperatives make up the total existing-home sales, which increased 2.2% from November to a seasonally adjusted annual rate of 4.24 million in December. Sales increased 9.3% year over year (from 3.88 million in December 2023).
“Home sales in the final months of the year showed solid recovery despite elevated mortgage rates,” said 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.”
At the end of December, there were 1.15 million units in the total housing inventory, which was up 16.2% from a year earlier (990,000) but down 13.5% from November. At the current sales pace, unsold inventory is at a 3.3-month supply, which is higher than the 3.1-month supply in December 2023 but lower than the 3.8-month supply in November.
All property types combined had a median existing-home price of $404,400 in December, a 6.0% increase from $381,400 a year earlier. Price hikes were reported in all four U.S. regions.
“The median home price was elevated partly due to the upper-end market’s relative better performance,” Yun concluded. “Sales rose by 35% from a year ago for homes priced above $1 million, while sales fell for homes priced under $250,000.”
Seasonally unexpected endurance was demonstrated by the median home sales price, which increased 6.0% from a year ago and stayed at $404,000 in December.
To read the full report, including more data, charts, and methodology, click here.
