The National Association of Realtors reported that U.S. home sales in 2024 fell to 4.06 million, the lowest since 1995, due to persistently high mortgage rates and a limited housing inventory. The median home price surged to a record $407,500, exacerbating affordability issues, especially for millennials. The Federal Reserve's interest rate cuts have not significantly impacted mortgage rates, leading to decreased mobility among current homeowners. Industry experts warn of a persistent housing market failure, with inadequate supply meeting persistent demand, indicating another year of sluggish sales ahead.
The NAR's measure of existing-home sales fell to 4.06 million in 2024, the fewest sold since 1995, impacted by high mortgage rates and limited inventory.
Experts noted that with the average 30-year mortgage rate close to 7 percent, homeowners who bought at 2 or 3 percent have a strong incentive not to move.
RSM chief economist Joe Brusuelas highlighted that a housing market failure persists, as supply isn't increasing despite ample demand.
Chief economist Diane Swonk remarked on a perfect storm undermining housing affordability, coinciding with millennials entering their prime age for home buying.
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