High mortgage rates, rising property taxes and insurance costs have made homeownership increasingly unaffordable for Americans
Existing home sales in 2024 fell to the lowest level since 1995, with 4.06 million pre-owned homes sold, down 0.7% from the prior year, per the National Association of Realtors (NAR), far less than the 6 million homes sold in 2021.
The US population was about 25% smaller in the mid-1990s, making the weak home sales numbers even more pronounced today.
December saw a slight uptick in sales, but the US housing market remained sluggish, with sales down 20% compared to 2019 levels.
The US population was about 25% smaller in the mid-1990s, which further underscores the weak home sales numbers.
Mortgage rates, which topped 7% last week, continue to stifle activity despite three Fed rate cuts last year. Rising property taxes and home insurance costs further make homeownership unaffordable for Americans.
Many current homeowners who locked in rates below 4% in 2021 and 2022 do not want to let go of their houses.
The median existing home price rose 6% year-over-year in December to $404,400, mainly due to limited supply.
Builders tried to increase the inventory and constructed 1.63 million homes last year, a 12.4% increase from 2023, according to the US Census.
The weak housing market also affects mortgage lenders, brokerages and home-goods store sales.
Some experts remain optimistic about modest growth in 2025, but affordability challenges persist.