Housing affordability is showing signs of improvement lately, but costs still may be the biggest reason many buyers remain hesitant to get into the market. Existing-home sales—which includes single-family homes, townhomes, condos and co-ops—fell 2.4% in June from the previous month, backing off a five-month high reached in May. Still, sales remain nearly 3% higher than a year ago, the National Association of REALTORS® reported Thursday.
While sales fell last month, home prices soared. The median existing-home price hit an all-time high of $440,600 in June, NAR reports. Prices were up about 2% from a year ago, marking three consecutive years of monthly home price increases.
The elevated home prices and mortgage rates may be prompting prospective buyers to rethink their budgets.
“The back-and-forth in monthly home sales activity, driven by mild fluctuations in mortgage rates, shows how sensitive home buyers are to affordability conditions,” says Lawrence Yun, NAR’s chief economist. “However, job gains—more than half a million since the beginning of the year—will continue to provide support for the housing market.”
Even With High Home Prices, Affordability Is Improving
The housing affordability picture may be starting to shift. NAR’s Housing Affordability Index showed improving conditions nationwide, led by an 8.9% annual improvement in the West and an 8.3% gain in the South. The Midwest followed with a 6.2% annual improvement, while the Northeast posted a 4.5% gain.
Housing affordability has been hampered by higher mortgage rates, but that’s getting better, too. The 30-year fixed-rate mortgage averaged 6.49% for June, down from 6.82% a year ago, according to Freddie Mac.
Further, “affordability is better than a year ago because wage growth is outpacing home price growth,” Yun says. That said, “progress on long-term housing affordability could be hampered if inventory growth continues to stall. Without consistent gains in inventory, home prices can accelerate. It is critical to introduce more supply to the market to widen the opportunity for homeownership.”
Shaking Off Challenges
Housing inventories remain at historical lows, proving a challenge for buyers: The number of homes for sale was down 0.6% in June compared to May and only up by 1.3% from a year ago, NAR’s data shows.
Still, some home buyers are shaking off market challenges and finding a way to closing. For example, while home prices in the Northeast in June saw the biggest uptick nationwide, with median prices up nearly 4% from a year ago, it was also the only region to see a monthly increase in existing-home sales.
Also, first-time buyers aren’t backing down. They comprised 33% of existing-home sales in June, up from 30% a year ago, according to the June 2026 REALTORS® Confidence Index Survey.
Meanwhile, only 2% of sales in June were distressed properties—such as foreclosures and short sales—which remained at historical lows despite up from 1% in May.
Many homeowners continue to have strong equity in their properties. 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. As such, homeowners are leveraging the funds from a home sale and applying it to their next home purchase. About a quarter of buyers—which also includes second-home and investor purchasers—paid all cash for their home purchase in June.
Home Sales Breakdown by Region
Here’s a closer look at how existing-home sales fared across the country in June, according to NAR’s latest housing data.
- Northeast: Existing-home sales rose 2.1% in June compared to May, reaching an annual rate of 480,000—the same as last year. Median prices: $564,800, up 3.9% from a year ago.
- Midwest: Existing-home sales fell 3% in June compared to May, settling in at an annual rate of 980,000. Sales still were up 2.1% from a year ago. Median price: $346,600, up 2.7% from a year ago.
- South: Sales fell 3.6% in June month-over-month to an annual rate of 1.89 million. Sales were still up 3.8% from a year ago. Median price: $377,700, up 0.9% from a year ago.
- West: Existing-home sales dropped 1.3% in June from May, reaching an annual rate of 740,000. Sales were up 2.8% from a year ago. Median price: $633,600, up 0.9% from June 2025.
