U.S. existing home sales picked up in July, amid minor price cooling

Existing home sales in the U.S. rose by 2% in July, with demand bolstered by slowing price growth and declining mortgage rates.

The figures come from a Thursday report by the National Association of Realtors (NAR), which showed month-over-month sales increases in the Northeast, South, and West, but fell in the Midwest.

"The ever-so-slight improvement in housing affordability is inching up home sales," said NAR Chief Economist Lawrence Yun. "Wage growth is now comfortably outpacing home price growth, and buyers have more choices."

The median existing-home price was $422,400 in July, up 0.2% from one year ago.

"Near-zero growth in home prices suggests that roughly half the country is experiencing price reductions," added Yun.

Sales grew the most in the Northeast, up 8.7% month-over-month, with the median price up 0.8% from July 2024. The Midwest saw a 1.1% decrease in sales month-over-month, where median prices were up 3.9% from July 2024.

Ever-so-slightly cooling mortgage rates may have also supported sales growth. The average 30-year fixed-rate mortgage was 6.72% July, down from 6.82% in June and 6.85% one year ago.

While the data suggests green shoots of recovery in the housing market, another report out Thursday suggests a weakening labor market may be weighing down on sales.

More than two-fifths of American workers are delaying or canceling a major purchase like a home or car due to their feelings about job security, according to a survey from real estate brokerage Redfin. This rises to almost 60% of respondents earning less than $50,000 per year.

Unemployment came in at 4.2% in July, only marginally less than the June rate of 4.1%. Despite remaining at historically low levels, 31% of Redfin's survey respondents said that they are either "somewhat concerned or very concerned" about their job security, suggesting a shift in attitude towards the labor market, irrespective of its material resilience.

“Many workers are worried about job security as they watch their companies adjust to this uncertain economy and increasingly look to AI and other new technologies for efficiency gains,” said Chen Zhao, Redfin's head of economics research. This hesitation, however, could bring prices down further, she hinted.

"Sellers should recognize that buyers are cautious, so pricing a home competitively and offering flexibility will be critical to closing a deal," Zhao said.