Sales of previously owned US homes fell 2% in August from July to a seasonally adjusted annual rate of 3.98 million units, the National Association of Realtors reported Thursday. It marks the third consecutive monthly decline and the slowest sales pace in more than a year, as buyers face higher borrowing costs and climbing home prices.
Why are home sales slowing down?
The main drag has been mortgage rates, which climbed after tensions tied to the Iran war rattled financial markets and pushed borrowing costs higher for prospective buyers. Combined with home prices that continue to rise, affordability has worsened for many would-be purchasers, forcing some to delay or abandon plans to buy.
Higher borrowing costs are keeping many potential buyers on the sidelines, industry analysts say.
What does this mean for the broader housing market?
Three straight months of declining sales suggest the housing market is losing momentum after a period of relative stability earlier in the year. With mortgage rates still elevated and home prices showing no signs of easing, real estate professionals expect the slowdown to persist unless borrowing costs retreat meaningfully in the coming months.
The National Association of Realtors’ August figures reflect a market where reduced affordability is reshaping buyer behavior, even as inventory dynamics and seasonal patterns continue to play a role in overall sales trends.
