U.S. existing home sales registered an unexpected decline in April, slipping by 0.5% to an annual rate of four million units. This marks the lowest level for April sales since 2009, as the housing market continues to be hampered by elevated mortgage rates and persistent affordability challenges. The downturn was more pronounced than many analysts had forecast and reflects the ongoing pressure exerted by high borrowing costs on potential homebuyers.
The average rate for a 30-year fixed mortgage remains over 7%, a level not seen consistently in well over a decade. This sustained rate environment has kept monthly payments high, deterring first-time buyers and sidelining those who may otherwise consider upgrading or relocating. In addition to expensive financing, home prices continue to push upward. The national median price of existing homes rose by 1.8% year-over-year to $414,000, setting a record high for April. Despite modest gains in wages and employment stability, many prospective buyers have found themselves priced out of the market.
Inventory levels rose 9% in April, reaching approximately 1.45 million homes, representing a 3.5-month supply at the current sales pace. While this increase could signal improved options for buyers, it has not yet translated into higher transaction volumes. Many listings remain unaffordable or fall short of buyers’ expectations, especially as sellers continue to list at premium prices amid tight market dynamics.
Homes spent more time on the market in April, with the average property remaining available for 26 days before sale, up slightly from the prior month. This lengthening time-on-market is another indicator of declining demand, particularly as buyers become more selective and cautious. The number of all-cash buyers remains steady, representing nearly 28% of total sales, suggesting that liquidity still plays a major role in market participation. Investors and second-home buyers also maintain a presence, further intensifying competition for affordable homes.
Regionally, the Northeast and Midwest recorded slight increases in sales activity, while the South and West experienced notable declines. These shifts point to varying degrees of affordability and economic resilience across U.S. regions, influenced by local job markets, cost of living, and available inventory. Despite the general slowdown, real estate professionals report sustained interest in suburban and lower-density areas where home prices remain more attainable.
The April decline in existing home sales highlights the continued friction between supply, demand, and affordability in the U.S. housing market. While inventory gains suggest a shift toward a more balanced market, elevated interest rates and record-high home prices remain formidable obstacles. Without meaningful adjustments in borrowing costs or a slowdown in price appreciation, the market may struggle to regain momentum. Policymakers and industry stakeholders must weigh strategies to address housing affordability, particularly for first-time and lower-income buyers, if long-term demand is to be restored sustainably.