Residential Real Estate News
Under Biden, 2024 Marked the Slowest U.S. Home Sales Period in 30 Years
In 2024, existing U.S. home sales fell to their lowest annual level since 1995, with just 4.06 million homes sold on an annualized basis. This steep decline was driven by 23-year high mortgage rates, extreme home price inflation, restrictive government regulations, declining consumer sentiment and a shortage of housing inventory.
However, according to the National Association of Realtors (NAR), existing-home sales showed small signs of recovery in December 2024, post-election. Sales increased in three of the four major U.S. regions while slipping in the Midwest. Year-over-year, sales improved across all regions. Total existing-home sales, which include single-family homes, townhomes, condominiums, and co-ops, rose by 2.2% from November to a seasonally adjusted annual rate of 4.24 million in December. Compared to December 2023, sales surged by 9.3% (up from 3.88 million).
"Despite elevated mortgage rates, home sales in the final months of the year demonstrated solid recovery," said NAR Chief Economist Lawrence Yun. "Winter sales are typically slower than those in spring and summer, but momentum has been building with year-over-year gains for three consecutive months. Job and wage growth, along with improved inventory, are positively impacting the market."
By the end of December 2024, total housing inventory was 1.15 million units, down 13.5% from November but up 16.2% compared to a year ago (990,000). Unsold inventory represented a 3.3-month supply at the current sales pace, down from 3.8 months in November but slightly higher than December 2023's 3.1 months.
The median home price reached a record high of $407,500 in 2024. In December, the median price for all housing types was $404,400, a 6.0% increase from December 2023 ($381,400). All regions reported price increases. Yun noted that higher-end markets performed relatively better, with sales of homes priced above $1 million rising by 35% from the previous year, while sales of homes under $250,000 declined.
Realtors Confidence Index
In December, homes typically remained on the market for 35 days, up from 32 days in November and 29 days in December 2023. First-time buyers accounted for 31% of sales, an increase from 30% in November and 29% in December 2023. However, NAR's 2024 Profile of Home Buyers and Sellers revealed that the annual share of first-time buyers reached a historic low of 24%.
Cash sales made up 28% of transactions in December, up from 25% in November but slightly lower than 29% in December 2023. Investors or second-home buyers, often responsible for cash purchases, accounted for 16% of sales, up from 13% in November and equal to December 2023. Distressed sales--foreclosures and short sales--remained unchanged at 2% year-over-year and from November 2024.
Mortgage Rates
Freddie Mac reported that the 30-year fixed-rate mortgage averaged 6.96% as of January 23, 2025. While this rate was slightly lower than the previous week's 7.04%, it was higher than 6.69% one year earlier.
Single-Family and Condo/Co-op Sales
Single-family home sales rose by 1.9% in December to a seasonally adjusted annual rate of 3.83 million, a 10.1% increase from the previous year. The median price for single-family homes in December was $409,300, up 6.1% from December 2023.
Condominium and co-op sales grew by 5.1% in December to a seasonally adjusted annual rate of 410,000 units, up 2.5% year-over-year. The median price for condos was $359,000, a 4.5% increase from December 2023 ($343,500).
Regional Breakdown
- Northeast: Sales increased by 3.9% from November to an annual rate of 530,000 in December, up 10.4% from December 2023. The median price was $478,900, an 11.8% rise from last year.
- Midwest: Sales dipped by 1.0% in December to an annual rate of 990,000, but were up 6.5% from December 2023. The median price climbed to $298,600, a 9.0% year-over-year increase.
- South: Sales rose 3.2% from November to an annual rate of 1.93 million, a 9.0% increase from the prior year. The median price was $361,800, up 3.4% year-over-year.
- West: Sales grew by 2.6% in December to an annual rate of 790,000, up 12.9% from a year earlier. The median price was $614,500, a 6.0% increase compared to December 2023.
