"The factors that would drive higher home sales —- such as mortgage rates meaningfully lower now compared to one year ago, inventory beginning to increase and, of course, jobs continuously being added to the economy —- and yet home sales are stuck at low levels,” said Lawrence Yun, the NAR’s chief economist.
One reason could be the escalating prices of houses.
House prices increased on an annual basis for the 15th consecutive month. The national median sales price rose 3% from a year earlier, to $404,500.
While the rate of price growth has been slowing, the latest median sales price is 49% higher than it was five years ago, before the pandemic. By comparison, wages grew 25% in the same period, Yun noted.
Years of soaring home prices have helped put homeownership out of reach of many Americans, making housing a key political issue for voters to consider in next month's election.
First-time homebuyers who don’t have any home equity to put toward their down payment continue to have a tough time getting into the housing market. They accounted for just 26% of all homes sold last month, matching the all-time low from August. It was down from 27% in September last year. They’ve accounted for 40% of sales historically.
