From NAR: “Existing-home sales increased for the third straight month due to lower mortgage rates this autumn,” said NAR Chief Economist Lawrence Yun. “However, inventory growth is beginning to stall.”
My central theme for existing home sales has always been that the bar is so low that we can trip over it. Meaning it doesn’t take much to grow sales here, but it typically happens when mortgage rates head lower, and especially when mortgage rates head toward 6%. 2025 sales data looks normal to me with that mindset. In fact, purchase application data has had its best 20 weeks of the year recently, and this data looks out 30-90 days.
Below is a historical look at existing home sales going back decades. No matter how high rates, taxes, prices and insurance go, we haven’t been seeing a crash in home sales since the end of 2022, but we’ve been building a low base of sales to work from.
NAR Inventory in November:
- 1.43 million units: Total housing inventory, down 5.9% from October and up 7.5% from November 2024 (1.33 million).
- 4.2-month supply of unsold inventory, down from 4.4 months in October and up from 3.8 months in November 2024.
We have heard a lot of people talk recently about how housing is worse now than in 2008, but I am assuming these people were just children during that time. Home prices fell 12% in 2008, which was the most significant national price crash post World War II and we had massive distressed sellers during that period. Just take a look at the bankruptcy and foreclosure data back then:
NAR Total active inventory:
- In 2007: 4 million
- Currently: 1.43 million
NAR Months of supply:
- In 2008: over 10 months
- Currently: 4.2 months
It’s tough for me to take people seriously who talk about “worse than 2008” when the data above was readily available for anyone to read.
NAR Median sales price in November:
- $409,200: Median existing-home price for all housing types, up 1.2% from one year ago ($404,400)
- This is the 29th consecutive month of year-over-year price increases.
One of the things I got wrong in 2025 was assuming we would have some negative year-over-year pricing data in October-December, as year-over-year comps were tough. Last year, home prices firmed up in the second half of the year, and with higher inventory this year, I assumed we would have seen some slight negative year-over-year data by now, but that hasn’t happened. We have one more month left for 2025.
Conclusion
These existing home sales look about right to me; sales rising from the lows of June make sense with our Housing Market Tracker data and where mortgage rates have been trending. Earlier in the year, year-over-year sales comps were very easy. If sales data were just trending at 4 million from June to October, we would see growth. Now, the comps are a bit harder and we saw a 1% decline year over year. Still, sales are at a nine-month high and have been trending up since the lows in June.
