Existing Home Sales Fall to 14-Month Low as Inventory Hits Decade High, Prices Still Set a Record

Existing-home sales fell 2.0% in August from July, to a seasonally adjusted annual rate of 3.98 million, according to the National Association of Realtors. That's the slowest pace since June 2025 and the third straight monthly decline, according to Continuum Economics. Sales were also down 1.2% from a year earlier.

At the same time, supply is the highest it's been in years. NAR counted 1.62 million homes for sale at the end of August, up 3.2% from July and up 5.9% from a year ago. That works out to 4.9 months of supply at the current sales pace, which NAR chief economist Lawrence Yun called the highest level in over a decade. Morningstar, citing NAR's own data, noted the raw inventory number of 1.62 million units is the most since November 2019, nearly a seven-year high.

More homes on the shelf hasn't translated to cheaper homes. The median existing-home price hit $429,100 in August, up 1.6% year-over-year and a record for the month, according to CNBC. Continuum Economics points out the median actually fell 1.4% from July, but that's mostly seasonal, and the year-over-year gain has stayed in a tight 0.3% to 2.5% band for the past year.

Rates Are the Problem, Not Supply

The 30-year mortgage rate averaged 6.97% on Wednesday, September 9, according to Mortgage News Daily, cited by Morningstar. Realtor.com data shows the rate climbed from 6.05% in February to 6.67% in August, six straight months of increases. Danielle Hale, chief economist at Realtor.com, said a rate hike is expected at next week's Federal Reserve meeting, which would put more pressure on sales. Continuum Economics flagged the same risk.

Yun offered the bullish counterargument: wages grew 3.1% in August and the economy has added 643,000 net new jobs since the start of the year, which he says supports demand even with rates elevated. Existing-home sales are still up 1.6% year-to-date through August despite the August dip. But the month-to-month data doesn't back up an optimistic near-term read. Pending home sales, a leading indicator, fell 3.7% year-over-year in August, according to Realtor.com data reported by Inman, ending an eight-month streak of annual gains that peaked at 4.1% in May.

Buyers Are Getting Leverage, Slowly

Homes sat on the market an average of 31 days in August, up from 29 in July, per NAR. The share of active listings with a price cut rose to 20.4% in August, matching last year's rate for the first time in 2026, according to Realtor.com data via the Epoch Times and Inman. Jake Krimmel, senior economist at Realtor.com, said price cuts and pending sales are now moving the opposite direction of delistings, calling it a market where sellers are becoming more willing to deal.

Delistings, sellers pulling their homes rather than cutting the price, fell 12.6% year-over-year in August, according to Realtor.com's report covered by the Epoch Times. That follows drops of 8.3% in June and 4.7% in July. Compare that to summer 2025, when delistings spiked 48% and 57% year-over-year in June and July, as sellers refused to budge. Sellers appear more patient now, or more realistic.

Regionally, the West and South have the highest share of price-reduced listings, 22% and 21.4%, while the Northeast sits lowest at 14.1%, per the Epoch Times. That tracks with CNBC's finding that Northeast prices rose the most and inventory there is tightest, while the West was the only region to see prices fall year-over-year.

Who's Actually Buying

First-time buyers made up 30% of August sales, a slight uptick from July and last year, per CNBC's reporting on NAR data. Cash buyers held at 27% of sales. But investors and second-home buyers fell sharply, to just 15% of sales from 21% a year ago, suggesting the speculative money that once helped prop up the market is sitting on the sidelines.

Sales are increasingly a story of two markets. Homes priced $100,000 to $250,000 saw sales drop 10% year-over-year, while sales above $1 million rose 3.9%, the only price tier to grow, according to NAR data cited by CNBC. First-time buyers are getting priced out of the market entirely.

Where Coverage Splits

Crypto Briefing framed the report almost entirely as good news for buyers, emphasizing supply relief and calling it "breathing room." Morningstar's MarketWatch coverage, by contrast, led with sales hitting the lowest level of the year, treating the inventory gain as a footnote to weak demand. Both are reading the same NAR numbers. Neither is wrong, but a reader who only saw the Crypto Briefing headline wouldn't know sales just hit a 14-month low.

The unresolved question is whether the Fed actually raises rates at next week's meeting, and what that does to a mortgage rate already brushing 7%. Continuum Economics and Realtor.com's Danielle Hale both flagged it as the next data point that could tip the market further toward buyers, or freeze it entirely.