The National Association of Realtors’ index of signed contracts for previously owned homes declined sharply, reaching levels not seen since the data series began in 2001.
• Elevated borrowing costs have reduced affordability, particularly for first-time buyers.
• Many homeowners who secured low mortgage rates in recent years remain reluctant to sell, limiting the supply of available properties.
• The resulting market slowdown is affecting both buyers and sellers, with fewer transactions and less competition.
• Economists are watching interest rates closely for signs of relief, but a sustained recovery may depend on mortgage costs falling significantly.
The housing market’s weakness reflects a broader affordability crisis: Home prices remain high in many regions, while monthly payments have surged compared with just a few years ago. Even as some buyers wait for better conditions, limited inventory could keep prices from falling substantially.