US Home Sales Rebound Slightly as Mortgage Rates Ease From Their Peak

America’s housing market has delivered a small piece of good news — and a large warning label with it. Sales of previously owned homes rose 1.5 percent in September 2026 to a seasonally adjusted annual rate of 3.99 million, according to the National Association of Realtors, which released the figures on October 13. Mortgage rates also eased slightly from their autumn peak, with Freddie Mac’s survey putting the average 30-year fixed rate at 7.32 percent for the week ending October 22, down from 7.40 percent the week before. Weekly contract signings steadied in late October after a long slide.

That is a rebound only in the narrowest sense. September’s sales pace was still 2.2 percent lower than a year earlier, and August and September together were the two slowest months for home sales in 2026, the Realtors’ chief economist Lawrence Yun said. September’s closings largely reflect contracts signed in the summer, when rates were lower than in October. The data show a market that has stopped falling quite so fast, helped by more homes for sale and a small dip in borrowing costs, rather than a market turning decisively upward.

The latest sales data in plain terms

Existing-home sales — completed transactions for single-family homes, townhomes, condominiums and co-ops — rose 1.5 percent from August to September, reaching a 3.99 million annual pace. August was revised down to 3.93 million, so the gain starts from a lower base than first reported. Sales have hovered near 4 million since 2023, far below the roughly 5.2 million pace often called historically normal.

Prices have not come down to meet buyers. The national median existing-home price was 417,500 dollars in September, up 1.3 percent from a year earlier and a record for the month of September, marking the 39th consecutive month of year-over-year price gains. Buyers who can still proceed are absorbing both a high price and a high rate. Supply improved: inventory rose 1.9 percent from August to 1.60 million homes, up 4.6 percent from a year earlier, equal to about 4.8 months of supply — the highest inventory since November 2019 on the Realtors’ measure. Homes took a median 33 days to sell, up from 31 in August.

New homes tell a flatter story. New-home sales slipped 0.6 percent in September to a 676,000 annual rate, down 5.3 percent from a year earlier, according to figures summarized by KPMG, while builder sentiment fell in October to its lowest since June 2012. The resale uptick did not extend to new construction.

Mortgage rates ease from their peak — but not by much

The rate story needs careful reading, because the timing cuts against any simple celebration. The average 30-year fixed rate was 6.86 percent in September as a whole, up from 6.67 percent in August and 6.35 percent a year earlier, according to Freddie Mac figures cited by the Realtors. Rates then climbed in October to 7.40 percent for the week ending October 8 — the highest in nearly three years — before easing to 7.32 percent for the week ending October 22. The 15-year fixed rate averaged 6.68 percent in that late-October week, compared with 5.44 percent a year earlier.

An 8-basis-point weekly decline, after a rise of roughly 74 basis points over the preceding month or so, is a breather, not a breakthrough. It coincided with a fall in the 10-year Treasury yield, which closed below 5 percent on October 22 for the first time since late September. But rates remain more than a full point above the 6.19 percent average of a year earlier, and forecasters promise little relief: Fannie Mae’s October forecast expects the 30-year rate to average 7.4 percent in the final quarter of 2026 and 7.5 percent in every quarter of 2027. Yun has described rates around 7 percent, or slightly above, as the new normal for buyers to plan around. The lag matters: many homes that closed in September went under contract in July and August, when rates ranged from about 6.43 percent to 6.69 percent. September’s closings thus reflect summer borrowing costs; October’s higher rates will show up mainly in autumn and winter closings.

The affordability picture: prices, payments and the lock-in effect

Affordability is where the rebound runs into arithmetic. The Realtors’ affordability index for September stood at 105.4, above August but below 106.7 a year earlier, meaning a typical household’s ability to afford a typical home slipped over the year even as inventory improved. For example, a 420,000-dollar listing a year ago at about 6.19 percent cost roughly 2,056 dollars a month in principal and interest with 20 percent down, while a comparable 414,000-dollar listing above 7 percent costs roughly 2,232 dollars — about 176 dollars more despite a lower price.

That payment gap also explains why so few owners list. About 49.1 percent of outstanding mortgages carried rates below 4 percent in the second quarter of 2026, according to Realtor.com research on federal mortgage data, while only about 22.5 percent were at 6 percent or higher. For an owner holding a 3 percent loan, moving means trading a cheap mortgage for an expensive one, and most stay put. Fresh listings fell 1.5 percent from a year earlier in late October on one listing tracker, even as total homes for sale rose 8.0 percent. More than one in five listings took a price cut in September, a four-year high. About 14.5 percent of homes that went under contract in September were later cancelled, according to Redfin, the highest share outside the early pandemic months. Weekly contracts steadied in the week ending October 23 at 52,490, still about 22.5 percent below a year earlier — one steadier week is not a trend.

Where American home sales diverge by region

The national uptick was not evenly spread. Month over month, sales rose in the South and West, held steady in the Midwest and fell in the Northeast; year over year, they fell in all four regions.

The South remains the engine of volume: sales rose 2.8 percent from August to a 1.86 million annual pace, down just 0.5 percent from a year earlier, with a median price of 361,000 dollars, up only 0.2 percent. The West also rose 2.8 percent month over month, to a 730,000 pace, but suffered the steepest annual decline, down 5.2 percent, and its median price of 613,600 dollars was the only regional median to fall year over year, down 0.3 percent.

The Midwest was unchanged from August at a 930,000 pace, down 2.1 percent from a year earlier, with the lowest median price in the country at 329,600 dollars, up 3.1 percent. The Northeast went the other way on both counts: sales fell 2.1 percent from August to a 470,000 pace, down 4.1 percent from a year earlier, while its median price jumped 4.7 percent to 523,600 dollars, the biggest regional gain. Affordability declined over the year in the Northeast, Midwest and South, while the West recorded a small improvement — consistent with tight Northeast supply pushing prices up even as fewer people can buy.

What buyers, sellers and economists say

Yun’s message was deliberately restrained: despite the small monthly gain, August and September marked the two slowest months for home sales this year, and further rate increases in recent weeks mean fewer buyers can qualify. That caution is widely shared. Lisa Sturtevant, chief economist at Bright MLS, noted that while easing rates and increased inventory have attracted some buyers, the market still faces affordability and economic uncertainty as headwinds. Agents’ advice is consistent: buyers should negotiate the payment, not just the price, and sellers should price for today’s market, not 2021’s.

Economists warn against reading too much into one month’s closed sales. Pending sales are the leading indicator, and September’s pending weakness points to softer closings ahead, even if late-October’s steadier weekly contracts and slightly lower rates offer hope for winter. HousingWire notes weekly contracts take 30 to 60 days to show up in completed sales, so one steadier week does not establish a rebound.

Outlook: a slow thaw, not a boom

The most likely path, on published forecasts, is stabilization rather than surge. Fannie Mae projects total home sales of 4.672 million in 2026 and 4.713 million in 2027, with existing-home sales of 4.031 million this year and 4.061 million next year, and new single-family sales rising only from about 641,000 to 652,000. Prices are forecast to rise 2.7 percent in 2026 but only 0.6 percent in 2027.

The next test arrives November 12, when October sales are released — the first report capturing closings from contracts signed during the October rate spike. If October sales soften, as pending data suggest, the easing to 7.32 percent will look like a small step back from a peak — welcome but too small to reopen a market frozen by high prices, high rates and owners locked into cheap old loans. If pending stabilization holds and rates drift lower, buyers may get a window — not a boom, but a market with more choice and negotiating room. For now the honest headline is the modest one: sales ticked up, rates ticked down from their peak, and American housing is still waiting for the thaw to prove itself.

Sources

USN reviewed reporting from multiple outlets for this story. Read more from National Association of Realtors, KPMG and WRE News.