• Existing home sales in the US increased 0.5% in November compared to October.
• Median home prices rose to $409,200, marking 29 months of annual increases.
• Sales are down 1% from November 2024, the first annual decline since May.
• Economic uncertainty and high prices are deterring potential buyers.
• Inventory of unsold homes dropped to a low of 1.43 million units.

The US housing market showed a modest recovery in November, with existing home sales rising 0.5% from October to a seasonally adjusted annual rate of 4.13 million units, while experiencing a decline of 1% compared to the same month last year. This marked the first year-over-year decrease since May 2024. Economists had anticipated a more robust performance, projecting sales to reach a rate of 4.14 million units, indicating subdued market expectations, according to Indiatimes and Los Angeles Times.

Even as sales figures reveal a slight uptick, the national median home price rose to $409,200, representing a 1.2% increase from a year ago. This trend marks 29 consecutive months of rising prices, underscoring persistent affordability challenges for many homebuyers. These high prices contribute to a stagnation in sales volume, which has hovered around 4 million units annually for over a year, significantly below the historical norm of about 5.2 million units, according to Reuters and Los Angeles Times.

Notably, the inventory of homes available for sale has decreased, dropping to 1.43 million units, down 5.9% from October and while showing an increase of 7.5% year-over-year, constraints on supply persist, predominantly affecting first-time buyers. Limited inventory combined with economic uncertainty is keeping many potential buyers on the sidelines, as emphasized by Oliver Allen, a U.S. economist, who noted that “big headwinds remain for housing market activity,” according to Reuters and Indiatimes.

Despite the easing of mortgage rates, which fell to approximately 6.19% at the end of November, many potential buyers remain concerned about affordability and job market instability, which are key factors curbing demand. The slow labor market, combined with inflationary pressures, has led to a climate where many consumers exercise caution regarding homeownership decisions, reflecting a sentiment echoed by experts, including Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets, who remarked on the lack of significant demand turnaround, according to Reuters, Indiatimes, and Los Angeles Times.