US Home Sales Hit Lowest Pace Since 2010

Existing-home sales in the United States fell 8.8 percent year-over-year in October to a seasonally adjusted annual rate of 3.75 million, the slowest pace since August 2010. While the average 30-year fixed-rate mortgage recently dipped to 7.11 percent—marking four consecutive weekly declines—rates remain above the 7 percent threshold, contributing to market gridlock as homeowners with low rates from 2022 refuse to sell.

Freddie Mac and other analysts note that while current rates are historically typical, homebuying is significantly less affordable than it was in 1997. At that time, a median-priced home required 23% of a typical household's monthly income; today, that share has risen to 31%. This gap stems from median home prices increasing by 228% since 1997, far outpacing the 136% growth in median household income.

Market conditions remain strained by persistent inflation and federal borrowing needs that keep Treasury yields elevated. Fannie Mae projects the average 30-year fixed mortgage rate will stay at 7.5% throughout 2027. Additionally, a recent jump in consumer prices has increased the likelihood that the Federal Reserve System will raise interest rates in December, which could put further upward pressure on mortgage rates.