US existing-home sales fell to a 16-year low in October, as elevated mortgage rates and rising inflation kept buyers on the sidelines. The National Association of Realtors reported Wednesday that sales dropped to 3.75 million, 8.8% below the same month a year earlier, the weakest pace since August 2010. The median existing-home sale price edged up to $416,700.
The pullback was broad but uneven. Sales declined in the Midwest, South and West, while the Northeast held steady. The NAR data landed as the 30-year fixed mortgage rate hovered around 7.18%, close to the 7.79% high reached in 2023. Mortgage rates had been falling through 2024 and 2025, and the 30-year rate dipped below 6% for the first time in February 2026. But higher inflation and interest rates during the Iran war pushed borrowing costs back to a nearly three-year high. During the pandemic, average mortgage rates were just above 3%.
Lawrence Yun, NAR’s chief economist, said affordability has become a severe obstacle. “Home buying is difficult when mortgage rates have climbed to their highest levels since 2000, aside from a single month in 2023,” Yun said. “As a result, home sales fell to their lowest level since August 2010.”
Signed contracts also point to weak momentum. Pending home sales, which measure contracts signed before closing, fell in September to the lowest level in NAR’s history. That same month, the 30-year mortgage rate topped 7% for the first time in nearly two years.
The Federal Reserve’s interest-rate path has fed directly into mortgage costs. The central bank raised rates in September for the first time since 2023, leaving its benchmark range at 3.75% to 4%. It is poised to raise rates again next month to combat heightened inflation, which rose 0.4% in October and increased more than expected. The October reading arrived as price increases cooled and gasoline costs dipped.
Housing costs weigh on politics and households
Affordability and cost-of-living concerns played an outsized role in the midterm elections that gave Democrats control of Congress next year. Census data show that growth in the median US rent has outpaced inflation. The same data show the US home-ownership rate has stagnated since 2021.
Danielle Hale, chief economist at Realtor.com, cautioned against treating the slump as a permanent shift. “I don’t think this is a new normal for home sales,” Hale said. “Instead, it reflects a perfect storm of an abrupt shift in the financial environment and large uncertainties in the pre-election period for both policy and the economy just as the housing market usually slows for the season.”