Existing-home sales edged slightly higher in September, with more buyers closing deals than in August. Still, the market remains sluggish—and with mortgage rates recently topping 7%, many prospective buyers are having to recalculate what they can afford amid still-rising home prices. The silver-lining for those who remain in the hunt: Greater negotiating power and more price cuts.
Existing-home sales—which includes single-family homes, townhomes, condos and co-ops—rose 1.5% in September compared to August, but sales were down 2.2% compared to a year ago, according to the latest housing data released by the National Association of REALTORS®.
“Despite the small monthly gain on a seasonal adjusted basis, August and September marked the two slowest months for home sales this year,” says Lawerence Yun, NAR’s chief economist.
The rise in borrowing costs is threatening affordability. “Further increases in mortgage rates in recent weeks mean fewer buyers can qualify to purchase a home,” Yun says.
The 30-year fixed-rate mortgage averaged 6.86% in September, according to Freddie Mac. But since October, rates have surpassed 7%. Freddie Mac reported 30-year rates averaged 7.4% for the week ending Oct. 8, compared to 6.3% from a year ago. On a $300,000 mortgage, that translates to about $220 more per month in principal and interest—nearly 12% higher than a year ago.
Related: Rate-Hike Shock? Here’s How Buyers Can Budget for It
Home buyers also still face elevated home prices. The median existing-home price rose to $417,500 in September, up 1.3% from a year ago, NAR reports. However, home price trends vary significantly by market. In the Northeast, median existing-home sales prices rose nearly 5% year-over-year in September, while the West saw prices dip slightly at 0.3% annually as price reductions grew more common in several markets.
Where Buyers May Find Opportunity
Home buyers this fall are likely to find more choices. The number of homes for-sale rose nearly 5% nationally compared to a year ago. Home sellers are keeping their homes listed, even if it may take longer to sell. The median time on the market in September was 33 days, up from 31 days in August, NAR’s data shows.
“Higher inventory and lengthening days on market give buyers improved negotiating power,” Yun says. “Home sellers need to be realistic about local market conditions, which could require price discounts and other incentives to attract buyers.”
Indeed, as mortgage rates rise, more sellers are reducing prices to keep buyers’ attention. The share of active listings with a price reduction increased to nearly 21% in September, the highest September reading since 2018, Realtor.com® recently reported. Among the 50 largest metros tracked, price cuts were most common in Salt Lake City, Utah, where 33.6% of listings had reduced prices last month, followed by Denver (32.1%) and Portland, Ore. (31.6%).
While price adjustments may be growing in some markets, most homeowners continue to maintain strong equity positions. Distressed sales—foreclosures and short sales—comprised only 2% of sales in September, unchanged from a year ago, NAR reports.
Who’s Still Buying
First-time buyers aren’t backing away. They comprised 31% of sales in September, up from their 30% share in August and from a year ago, according to NAR’s latest existing-home sales report.
Recent price reductions may help bring first-time buyers closer to making a purchase. Forty percent of prospective first-time buyers said a price reduction is the seller concession that would most boost their confidence to move forward, according to a newly released study by Neighbors Bank. Nearly half—or 47%—of more than 900 potential or recent first-time buyers said they’d hold off on making an offer on a home until a home’s price is reduced.
First-time buyers also appear to be broadening their options to find more affordable homes. More than half (54%) are expanding their search radius, and 88% are open to buying outside a major metro area to find a more affordable home, the study found.
Individual investors and second-home buyers also weren’t backing away from the market in September. They comprised 20% of transactions in September, up from 15% a year ago, NAR’s data shows. They tend to pay all-cash—with all-cash buyers making up 27% of sales last month.
Regional Breakdown
Last month, existing-home sales posted the largest increase in the South and West, while falling in the Northeast. Tight housing inventories continue to plague the Northeast, which saw a 4.1% annual decrease in home sales last month but also the nation’s highest yearly increase in its home prices.
Here’s a closer look at how existing-home sales fared across the country in September, according to NAR’s existing-home sales report:
- Northeast: Existing-home sales fell 2.1% in September compared to August, dropping to an annual rate of 470,000. Sales are down 4.1% from a year ago. Median price: $523,600, up 4.7% from September 2025.
- Midwest: Sales held steady last month at an annual rate of 930,000. Still, sales were down 2.1% compared to a year ago. Median price: $329,600, up 3.1% annually.
- South: Sales rose 2.8% month-over-month to an annual rate of 1.86 million. Sales were down slightly by 0.5% compared to September 2025. Median price: $361,000, up just slightly by 0.2% from a year ago.
- West: Sales rose 2.8% in September compared to August, reaching an annual rate of 730,000. Sales, however, were down 5.2% year-over-year. Median price: $613,600, down 0.3% from a year ago.
