The U.S. housing market presented a complex picture in November, as sales of previously owned homes remained nearly flat while prices climbed to a new record for the month. This dynamic highlights the persistent pressure of low inventory and high mortgage rates, creating a challenging environment for potential buyers.
According to the latest data, existing-home sales saw a marginal increase of just 0.5% from October. However, when compared to the same period last year, sales were down by 1%. This stagnation occurred as the national median home price reached $409,200, a 1.2% rise from November 2024 and the highest ever recorded for that month.
Key Takeaways
- Existing-home sales rose only 0.5% in November, reaching a seasonally adjusted annual rate of 4.13 million units.
- The median home price increased to $409,200, a new record for the month of November.
- Housing inventory fell by 5.9% from October, stalling recent gains and tightening the market further.
- Sales of high-end homes (over $1 million) increased, while sales of lower-priced homes (under $250,000) declined significantly.
- Investors increased their market share to 18% of transactions, up from 13% a year ago.
A Market in Stalemate
The slight uptick in home sales for November does little to change the broader narrative of a housing market grappling with affordability issues. The annualized rate of 4.13 million units reflects contracts that were likely signed in September and October, a period when mortgage rates saw some initial decline before stabilizing at elevated levels.
This sluggish sales activity contrasts sharply with the continued rise in home values. The median price of $409,200 marks a significant milestone, underscoring the market's resilience in the face of decreased transaction volume. Experts note that this price strength is largely a function of extremely limited supply.
The Inventory Problem Worsens
After several months of modest gains, the supply of homes for sale took a step backward in November. The total number of available properties fell to 1.43 million, a 5.9% decrease from October. While this figure is still 7.5% higher than a year ago, the recent decline is a concerning trend for buyers hoping for more options and less competition.
By the Numbers: November Housing Supply
- Total Homes for Sale: 1.43 million
- Month-over-Month Change: -5.9%
- Year-over-Year Change: +7.5%
- Months' Supply: 4.2 months
At the current sales pace, the available inventory represents a 4.2-month supply. A market is generally considered balanced when there is a six-month supply, indicating that conditions still heavily favor sellers. Lawrence Yun, chief economist for the National Association of Realtors, observed that this stall in inventory growth is partly seasonal but also reflects homeowner sentiment.
"With distressed property sales at historic lows and housing wealth at an all-time high, homeowners are in no rush to list their properties during the winter months," Yun stated.
This reluctance was further evidenced by a higher-than-usual rate of sellers delisting their properties as winter approached, a dynamic that was much more pronounced this year compared to previous years.
A Tale of Two Markets
The national median price of $409,200 can be misleading, as it masks a growing divergence between the high and low ends of the housing market. The data reveals that the luxury segment is performing significantly better than the market for more affordable homes.
Sales of homes priced between $100,000 and $250,000 plummeted by nearly 8% compared to November of last year. In stark contrast, sales of properties priced above $1 million saw a 1.4% increase over the same period. This trend skews the median price upward, as a greater proportion of sales are occurring in more expensive brackets.
Affordability and Market Dynamics
The struggle at the lower end of the market reflects the acute affordability crisis facing many Americans. First-time homebuyers, who typically purchase properties in this price range, are finding it increasingly difficult to compete. Their share of the market remained stagnant at 30%, well below the historical average of 40%.
Yun noted that while wage growth is currently outpacing home price gains, which should improve affordability, the lack of supply remains a major obstacle. "Future affordability could be hampered if housing supply fails to keep pace with demand," he cautioned.
Investor Activity Rises as Homes Linger on Market
Another key trend in November was the re-emergence of investors. They accounted for 18% of all transactions, a notable jump from 13% in November 2024. This suggests that professional buyers are finding opportunities in the current market, possibly capitalizing on properties that have been on the market longer.
Indeed, the typical time a home spent on the market increased to 36 days, up from 32 days a year ago. This slower pace gives buyers, particularly cash-heavy investors, more leverage and time to negotiate.
The combination of these factors—stagnant sales, shrinking inventory, record prices, and a widening gap between market segments—paints a picture of a housing market caught in a complex web of economic pressures. As the winter months continue, all eyes will be on whether supply can rebound in the spring to meet pent-up demand or if high prices and rates will keep the market in its current state of gridlock.
