Northeast, Midwest Lead Modest National Sales Gains Says NAR
U.S. existing-home sales ticked up in May, boosted by gains in the Northeast, Midwest, and South, though the Western housing market continued to lag, according to new data from the National Association of Realtors (NAR). The pace of sales rose 0.8% from April 2025 to a seasonally adjusted annual rate of 4.03 million units, but activity remains below last year’s levels, down 0.7% from May 2024.
The housing market’s momentum was uneven across regions. Sales advanced 4.2% in the Northeast and 2.1% in the Midwest, both of which also recorded year-over-year increases. The South saw a modest 1.7% monthly gain, though sales were down 0.5% from a year ago. The West continued to underperform, with sales sliding 5.4% on the month and 6.7% annually.
Lawrence Yun
“The relatively subdued sales are largely due to persistently high mortgage rates,” said Lawrence Yun, NAR’s chief economist. “Lower interest rates will attract more buyers and sellers to the housing market. If mortgage rates decrease in the second half of this year, expect home sales across the country to increase due to strong income growth, healthy inventory, and a record-high number of jobs.”
Inventory constraints eased slightly in May, with total unsold inventory climbing 6.2% from the prior month to 1.54 million units–equivalent to a 4.6-month supply at the current sales pace. That marks a 20.3% increase from one year earlier.
Home prices continued their upward march. The median existing-home price across all housing types hit $422,800 in May, a 1.3% gain from a year earlier and the highest ever recorded for the month. It marked the 23rd consecutive month of year-over-year price increases.
Single-family home sales rose 1.1% to an annualized rate of 3.67 million, edging 0.3% above May 2024 levels. The median price for single-family homes climbed 1.3% year-over-year to $427,800. In contrast, sales of condominiums and co-ops dropped 2.7% in May to a pace of 360,000 units–down 10% from a year ago–while the median price increased 0.7% to $371,300.
Regionally, the Northeast recorded the strongest price appreciation, with the median home price surging 7.1% to $513,300. The Midwest followed with a 3.4% increase to $326,400. Prices in the South declined 0.7% to $367,800, while the West saw a slight uptick of 0.5% to $633,500.
Despite modest monthly gains, housing market activity remains tempered by affordability challenges and elevated borrowing costs. Industry analysts say the direction of mortgage rates in the latter half of 2025 will be key to determining whether the market gains traction or stalls.
