Previously owned home sales in the U.S. rose for the third consecutive month in December, entering 2025 with some momentum after the worst year in nearly three decades.
Contract closings on existing homes last month rose 2.2% to an annual rate of 4.24 million, the most since February, according to National Association of Realtors data released Friday. That was in line with the estimate of economists surveyed by Bloomberg.
The third consecutive pick-up in monthly sales – the longest streak since late 2021, then
“Home sales in the final months of the year showed solid recovery despite increased mortgage rates,” NAR Chief Economist Lawrence Yun said in a prepared statement.
For all of 2024, however, sales reached their lowest since 1995, when the US had about 70 million fewer people. It marked the third consecutive annual decline, stretching only ever seen in the 2006 housing crisis and the recessions around the early 1980s and 1990s.
The median sales price, meanwhile, rose 6% over the past 12 months to $404,400, reflecting more sales activity at the top end of the market. That helped propel prices to a record for the year.
After slowly crossing for months, inventory fell 13.5% in December from the previous month – which is typical at the end of the year. It is still up 16.2% as of December 2023.
There was hope that 2024 could be a turning point for the housing market when the Federal Reserve began cutting interest rates. But mortgage rates are tracking Treasury yields, which rose nearly a full percentage point through the end of the year after inflation proved stubborn, fueling concerns that officials were easing policy too quickly. They are expected to keep rates steady at next week’s meeting.
Treasury yields are still elevated as investors brace for the costs of President Donald Trump’s policies and price pressures cool only slightly. That’s expected to keep mortgage rates on average above 6% until at least 2027, according to some estimates.
In December, 53% of homes sold were on the market for less than a month, unchanged from November, while 16% sold for above list price. Properties stayed on the market for an average of 35 days, compared to 32 days in the previous month.
Existing home account sales account for most of the US total and are calculated when a contract is made. The government will release figures on new home sales on Monday.