Despite a month in which the 30-year fixed-rate mortgage (FRM) fell nearly 25 basis points to finish August 2025 in the 6.5% range, prospective buyers, still wary of impending Fed rate cuts, were cautious in jumping back into the housing market.
According to the latest National Association of Realtors (NAR) Existing-Home Sales Report, sales remained essentially the same in August, ticking down by 0.2% from July. Month-over-month, NAR found that sales increased in the Midwest and West, and fell in the Northeast and South. Year-over-year, sales rose in the Midwest and South, and fell in the Northeast and West.
The 0.2% decrease in total existing-home sales month-over-month resulted in a seasonally adjusted annual rate of four million, and a 1.8% increase in sales year-over-year.
“Home sales have been sluggish over the past few years due to elevated mortgage rates and limited inventory,” said NAR Chief Economist Lawrence Yun. “However, mortgage rates are declining, and more inventory is coming to the market, which should boost sales in the coming months.”
The median existing-home price for all housing types was at $422,600 in August, up 2.0% from last August’s total of $414,200–marking the 26th consecutive month of year-over-year price increases.
“It may be too soon to tell if declining mortgage rates are bringing out more buyers. Sales reported for August reflect contracts on homes generally made 30 to 60 days prior, before the recent rate declines,” added Bright MLS Chief Economist Lisa Sturtevant.
There we no changes month-over-month in condominium and co-op sales, which remained at a seasonally adjusted annual rate of 370,000 units, down 5.1% year-over-year. NAR reported that condominium and co-op median prices rose 0.6% year-over-year to $366,800 in August.
“Despite improvement, rates are still not low enough to unlock the vast majority of homeowners, who continue to enjoy sub 6% rates, but it will help those on the margins and may lead to a more active fall home sales season,” said Realtor.com Chief Economist Danielle Hale. “Already, buyers can benefit from annual seasonal trends that tee up the fall housing market as the best time to buy a home. Diminished competition from other home shoppers and still relatively plentiful home options combine to soften home prices and give buyers with flexibility an edge. Lower rates and market momentum shifting more in favor of buyers as supply rises are just added advantages.”
A Regional Recap
Regionally, the Midwest led the way, reporting a 2.1% increase in sales was reported in August 2025 month-over-month to an annual rate of 960,000, up 3.2% year-over-year. At $330,500, the median price in the Midwest was up 4.5% from August 2024.
“The Midwest was the best-performing region last month, primarily due to relatively affordable market conditions,” Yun added. “The median home price in the Midwest is 22% below the national median price.”
The Midwest was followed by the Western U.S. in terms of monthly gains, up 1.4% in sales month-over-month to an annual rate of 730,000, down 1.4% year-over-year. At $624,300, the median existing-home sales price was up 0.6% from August 2024’s totals.
In the Northeast, NAR found a 4.0% decrease in existing-home sales month-over-month in August to an annual rate of 480,000, down 2.0% year-over-year. The median price reported in the Northeast in August was $534,200, up 6.2% year-over-year.
Also reporting a decline in sales was the Southern U.S., where NAR found a 1.1% decrease in sales month-over-month in August 2025 to an annual rate of 1.83 million, up 3.4% year-over-year. With a median price of $364,100, the price of existing-home sales were up 0.4% year-over-year.
Housing Inventory Rises YoY
NAR reported that in August 2025, total housing inventory reported was 1.53 million units, down 1.3% from July, and up 11.7% from August 2024’s total of 1.37 million. At a 4.6-month supply of unsold inventory, there was no change from July, and this total was up from 4.2 months reported in August 2024.
“Record-high housing wealth and a record-high stock market will help current homeowners trade up and benefit the upper end of the market. However, sales of affordable homes are constrained by the lack of inventory,” Yun added.
Additional Takeaways
- The median time on market for properties was 31 days in August, up from 28 days in July 2025, and 26 days in August 2024.
- Of buyer type, NAR found that 28% of sales in August 2025 were to first-time homebuyers, unchanged from July 2025, and up from 26% reported in August 2024.
- Cash sales made up 28% of transactions in August 2025, down from 31% a month ago, and up from 26% in August 2024.
- In terms of buyer type, 21% of transactions were to individual investors or second-home buyers, up slightly from 20% reported in July 2025, and 19% in August 2024.
- Distressed sales (foreclosures and short sales) comprised just 2% of all August existing-home sales, unchanged from July, and up slightly from 1% reported in August 2024.
“Buyers and sellers entering the market now through the end of the year are highly motivated,” said Jason Waugh, President of Coldwell Banker Affiliates. “Navigating seasonal changes such as school schedules, inclement weather, and holiday commitments shows serious intent. Sellers maintaining show-ready homes during this period are equally committed. With mortgage rates now at their lowest levels this year, improved affordability is prompting more prospective buyers back into the market. While inventory has plateaued nationally, the pace of new listings is slowing, which may once again tip the scales between buyer demand and available supply.”
Click here for more on NAR’s August 2025 Existing-Home Sales report.
