Existing-home sales gained momentum last month—especially out West—as prospective buyers took advantage of lower mortgage rates and a larger selection of homes for sale. The latest National Association of REALTORS® report showed existing-home sales rose 1.5% month-over-month in September, with sales up 4.1% compared to a year ago.
“As anticipated, falling mortgage rates are lifting home sales,” says Lawrence Yun, NAR’s chief economist. “Improving housing affordability is also contributing to the increase in sales.”
The 30-year fixed-rate mortgage averaged 6.35% in September, a significant drop from the near-7% rate averages earlier this year. A new study from LendingTree found that recent rate reductions—and shopping around among multiple lenders—have saved buyers an average of $40,000 over the life of a 30-year loan or reduced the average monthly mortgage payments by about $112.
Homeowners continue to fare well in this market, with many using the proceeds from their current home sale toward their next purchase. “Many homeowners are financially comfortable, resulting in very few distressed properties and forced sales,” Yun says. “Home prices continue to rise in most parts of the country, further contributing to overall household wealth.”
NAR’s latest report shows the median sales price for all housing types was $415,200 in September, a 2.1% increase from a year ago. While the pace of appreciation has eased from recent years, homeowners in many parts of the country are still seeing steady growth in home values.
Buyers Find More Options, More Time
Home buyers this fall are exploring the added inventory of homes for sale, which is at a five-year high, NAR reports. In September, housing inventories nationwide were 14% higher than a year earlier. Buyers also are taking more time to decide: The latest REALTORS® Confidence Index report shows that the median time on the market for properties rose to 33 days in September, up from 28 days a year ago.
Lower mortgage rates, increased inventory and less urgency are contributing to an increase in first-time home buyers entering the market. First-time buyers in September made up 30% of existing-home sales, up from 26% a year earlier, NAR’s report shows.
The Cash Buying Force
As home prices continue to climb, cash remains a powerful force in the housing market. According to NAR’s latest data, cash sales comprised 30% of all transactions in September, remaining near historic highs.
In some markets, the share of all-cash buyers is even higher. For example, the Sun Belt regions—often with large populations of retirees or second-home and investment activity—tend to see some of the highest number of all-cash sales, notes Nadia Evangelou, an NAR senior economist and director of real estate research, in a recent analysis of cash-buying activity on NAR’s Economists’ Outlook blog. In places like Sebastian-Vero Beach, Fla., 63% of buyers paid in cash, while other markets such as Houma-Thibodaux, La., Punta Gorda, Fla., and Naples, Fla., saw more than half of transactions completed without needing a mortgage.
The dominance of cash buyers is also showing up at the extremes of the housing market. A recent realtor.com® report found that nearly two-thirds of homes priced under $100,000 and more than 40% of homes over $1 million were purchased without financing. "Cash buyers have long been a fixture in the market, but their influence is more pronounced today than in pre-pandemic years," says Danielle Hale, chief economist at realtor.com®. "High-wealth buyers, investors and those with significant equity can move quickly and often win out in competitive situations.”
Regional Snapshot for Latest Home Sales
The uptick in existing-home sales last month was led by the West, which saw sales rise nearly 6% in one month, NAR’s report shows.
Here’s a closer look at how existing-home sales fared in September across the country:
- Northeast: Sales rose 2.1% in September, reaching an annual rate of 490,000. Sales were up 4.3% annually. Median price: $500,300, up 4.1% compared to a year ago.
- Midwest: Sales fell 2.1% last month compared to August, settling in at an annual rate of 940,000. Sales were still up 2.2% compared to a year earlier. Median price: $320,800, up 4.7% from September 2024.
- South: Sales rose 1.6% in September to an annual rate of 1.86 million. Sales surged 6.9% compared to a year ago. Median price: $364,500, up 1.2% from September 2024.
- West: Sales rose 5.5% last month to an annual rate of 770,000, holding steady compared to last year’s levels at this time of year. Median price: $619,100, slightly up by 0.4% compared to September 2024.
