High mortgage rates still hobbling the U.S. housing market
According to new data released by the National Association of Realtors, existing-home sales dipped again in April 2025, reflecting ongoing challenges in the U.S. housing market despite growing inventory and continued buyer interest.
Completed sales of existing homes–including single-family homes, townhomes, condominiums, and co-ops–fell 0.5% from March 2025 to a seasonally adjusted annual rate of 4.00 million units. Compared to a year ago, sales were down 2.0% from April 2024’s pace of 4.08 million.
Lawrence Yun
“Home sales have hovered around 75% of normal, pre-pandemic activity for the past three years–even as the economy added seven million jobs,” said NAR Chief Economist Lawrence Yun. “There’s clear pent-up demand, but it remains locked behind high mortgage rates. A meaningful drop in rates could unlock significant buyer activity.”
Inventory, Pricing, and Buyer Behavior
Housing supply showed signs of loosening. Total inventory reached 1.45 million units at the end of April, up 9.0% from March and a substantial 20.8% increase over the same period last year. At the current sales pace, that equates to a 4.4-month supply–up from 4.0 months in March and 3.5 months in April 2024.
The national median existing-home price in April climbed to $414,000, up 1.8% year-over-year. Regionally, prices rose in the Northeast and Midwest but fell slightly in the South and West.
“The market is still mildly favorable for sellers,” Yun noted. “But with inventory at its highest level in nearly five years, buyers now have more leverage and negotiating power.”
Market Dynamics: Who’s Buying?
According to NAR’s monthly Realtors Confidence Index:
- Homes spent an average of 29 days on the market in April, down from 36 days in March but up slightly from 26 days in April 2024.
- First-time buyers made up 34% of all transactions, an increase from both the previous month (32%) and last year (33%).
- All-cash sales made up 25% of all transactions, down slightly from 26% in March and 28% a year ago.
- Investors and second-home buyers accounted for 15% of April purchases.
- Distressed sales, including foreclosures and short sales, remained low at 2%.
Mortgage Rates Edge Up
Freddie Mac reported that the average 30-year fixed mortgage rate rose to 6.81% as of May 15, up slightly from 6.76% the week before but down from 7.02% at the same time in 2024.
Home Type Breakdown
Sales of single-family homes dipped 0.3% to an annual rate of 3.63 million, a 1.4% decrease from last year. The median price climbed to $418,000–up 1.7% from April 2024.
Condominium and co-op sales dropped more sharply, down 2.6% to 370,000 units. Year-over-year, condo sales are off 7.5%. The median price rose 1.4% to $370,100.
Regional Highlights
- Northeast: Sales fell 2.0% to an annual rate of 480,000–flat from last year. Median price: $487,400 (↑6.3%).
- Midwest: Sales rose 2.1% to 970,000 but were still down 1.0% from last year. Median price: $313,300 (↑3.6%).
- South: Sales held steady at 1.81 million, though down 3.2% year-over-year. Median price: $365,300 (↓0.1%).
- West: Sales dropped 3.9% to 740,000, a 1.3% annual decline. Median price: $628,500 (↓0.2%).
As summer approaches, all eyes are on interest rates and inflation indicators to determine whether buyer confidence–and transactions–will rebound in the months ahead.
