Sales of previously owned homes unexpectedly fell last month, slowing to a pace not seen since 2010 when the U.S. was still recovering from a housing market crash.
The National Association of Realtors (NAR) reported Wednesday that existing home sales declined 1% in September from the prior month to a seasonally adjusted annual rate of 3.84 million, which is a 3.5% drop from one year ago.
At the same time, the median sales price of existing homes jumped 3% from last September to $404,500, marking the 15th consecutive month of year-over-year price increases, the NAR said.
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The inventory of unsold existing homes, which includes single-family homes, townhouses and condominiums, rose by 1.5% in September from the prior month to 1.39 million.
"Home sales have been essentially stuck at around a four-million-unit pace for the past 12 months, but factors usually associated with higher home sales are developing," said NAR chief economist Lawrence Yun. "There are more inventory choices for consumers, lower mortgage rates than a year ago and continued job additions to the economy."
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Yun added, "Perhaps, some consumers are hesitating about moving forward with a major expenditure like purchasing a home before the upcoming election."
Holden Lewis, a Home and Mortgage Expert at NerdWallet, attributed the decline in existing home sales to a combination of rising mortgage rates and home prices that have pushed the prospect of a home purchase out of reach for more Americans amid an affordability crisis.
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"Mortgage rates have been rising steadily for a month as the job market remains robust. Meanwhile, the median home price has exceeded $400,000 for six straight months," Lewis said. "Rising mortgage rates and high home prices are ganging up on would-be homebuyers who struggle to find homes they can afford."
