US home sales weaken to slowest pace in more than a year as mortgage rates, home prices climb

Sales of previously occupied U.S. homes declined in August to their slowest annual pace in more than a year as home shoppers grappled with rising mortgage rates and home prices.

Existing home sales fell 2% last month from July to a seasonally adjusted annual rate of 3.98 million units, the National Association of Realtors said Thursday. This is the third straight monthly decline.

Sales also fell 1.2% compared with August last year. The latest sales tally is just shy of the 4 million pace economists were expecting, according to FactSet.

Home sales have been mostly hovering close to a 4-million annual pace going back to 2023, far short of the historic norm that is closer to 5.2-million. The last time the annual sales pace came in below 4 million was June 2025.

Despite the latest pullback, existing U.S. home sales are running 1.6% higher through the first eight months of this year than they were in the same stretch of 2025, NAR said.

The housing market has been stymied in large part by rising borrowing costs, as mortgage rates have marched higher in the months since the war between the U.S. and Iran started. Expectations of higher inflation amid surging oil prices have pushed up the long-term bond yields that lenders use as a guide to pricing home loans, pushing up mortgage rates. The average rate on the benchmark 30-year mortgage hit 6.71% last week, its highest level in more than a year.

Even as sales slowed, home prices continued to rise nationally last month. The U.S. median sales price increased 1.6% in August from a year earlier to $429,100, an all-time high for the month of August based on data going back to 1999, NAR said. Home prices have risen on an annual basis for 38 months in a row.