Improving affordability is bringing more home buyers back into the market, giving home sales a solid boost in May.
Existing-home sales—which includes single-family homes, townhomes, condos and co-ops—rose 3.2% last month compared to April’s mostly stagnant sales, the National Association of REALTORS® reported on Tuesday. Annually, home sales also posted a 3.2% increase, offering real estate pros more closed deals this spring. As sales rose, so did home prices: Existing-home prices reached a record high for the month of May, with home sellers still standing to benefit from relatively low competition.
“More Americans are on the move, with home sales rising to the highest level since December,” says Lawrence Yun, NAR’s chief economist. “This is great news for the housing market and the economy. Improving affordability is helping drive this momentum.”
Mortgage rates over recent weeks have been at the mid-6% levels (with the 30-year fixed-rate mortgage averaging 6.44% for the month of May). Rates are up compared to earlier in the year, but they remain lower than a year ago (rates averaged 6.82% in May 2025). Also, income gains have been slightly outpacing home-price growth lately in most areas of the country, Yun says. Housing affordability has seen the biggest improvement over the past year in the West, even as the region continues to have some of the highest home prices in the country.
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As affordability improves, more first-time home buyers are stepping back into the market. They comprised 35% of existing-home sales in May, up from 30% a year ago, NAR’s data shows.
Lean Choices Keep Home Prices Strong
Nationally, the number of For Sale signs was up 3.3% in May compared to April, but that’s only a 0.6% increase from a year ago, a much slower pace of growth than in recent months. While the number of homes on the market continues to increase, supply remains tight and still falls short of demand. That is keeping pressure on home prices.
The median existing-home price for all housing types in May climbed to $429,300, the highest ever recorded for the month of May, according to NAR. That represents a 1.3% increase in home prices compared to last year.
“The new record-high May home price reflects solid fundamentals for homeowners and ongoing supply constraints,” Yun says. “Only 1% of all home sales involved foreclosure or an underwater situation in which the sale price could not cover the outstanding mortgage balance. This shows homeowners are on solid financial footing.”
Earlier this spring, NAR’s data showed that price growth has helped the typical homeowner accumulate about $128,000 in housing wealth over the past six years alone. It’s helping more homeowners leverage the proceeds from a home sale to use for their next home purchase. About a quarter of buyers—which includes second-home and investor purchasers—paid all-cash for their home purchase in May, remaining at elevated levels.
Plus, as housing supply remains limited in many markets, about a quarter of homes last month sold above list price, according to the May 2026 REALTORS® Confidence Index Survey. Multiple offers are still common, with homes listed receiving an average of 2.3 offers in May. Homes are selling faster, with the median time spent on the market at 29 days in May, a quicker pace than a median 32 days in April.
Regional Breakdown: Sales Surge in the Midwest
The Midwest saw the largest jump in existing-home sales of the four major regions last month, continuing to offer some of the nation’s most affordable home prices.
Here’s a closer look at how existing-home sales fared across the country in May, according to NAR’s latest report:
- Northeast: Sales rose 2.2% in May compared to April, reaching an annual rate of 460,000. Sales, however, are down 8% from a year ago. Median price: $534,900, up 4.2% from a year earlier.
- Midwest: Sales jumped 6.4% in May month-over-month, the highest sales increase of all four regions. Sales, up 2% annually, reached an annual rate of 1 million last month. Median price: $336,300, up 2.8% from May 2025.
- South: Existing-home sales rose 3.2% in May compared to April, settling in at an annual rate of 1.96 million. Sales are up 5.9% compared to a year ago. Median price: $373,100, up 1.1% from May 2025.
- West: Sales stayed mostly stagnant in May at an annual rate of 750,000. Existing-home sales, however, were up 5.6% compared to last year. Median price: $625,900, down 0.7% from May 2025.
