Sales of previously owned homes tumbled to their weakest pace in over a year last month, according to data released Thursday by the National Association of Realtors (NAR). The decline, driven by climbing mortgage rates and record-high prices, underscores the mounting affordability squeeze facing American buyers.
NAR reported that existing-home sales fell 2% in August from July, landing at a seasonally adjusted annual rate of 3.98 million. That marks the lowest level since June 2025, when the pace hit 3.93 million. It was also the third straight monthly drop, with the inventory of unsold homes rising 3.2% over the month.
The housing market is feeling the ripple effects of the ongoing conflict in the Middle East, which has fueled uncertainty and pushed up long-term bond yields that mortgage rates track. The yield on the 10-year Treasury surged to 4.9% on Thursday, its highest since 2023, after the Treasury Department announced plans to buy back up to $6 billion in longer-term debt. Meanwhile, the benchmark 30-year fixed mortgage rate hit an intraday peak of 6.76% this week, the loftiest in more than 14 months.
“Mortgage rates and home sales move in opposite directions, so it’s not surprising to see a mild dip in home buying activity due to high mortgage rates,” said NAR Chief Economist Lawrence Yun in a statement.
Despite the monthly slump, Yun pointed to underlying strength in the broader economy. Sales during the first eight months of 2026 were up 1.6% compared with the same stretch in 2025. He attributed that resilience to solid job gains and wage growth, noting that payrolls have expanded by 643,000 since the start of the year and that wages rose 3.1% in August. “Job creation and wage growth typically drive housing demand,” he added.
The national median price for an existing home climbed to $429,100 in August, up 1.6% from a year earlier—an all-time high for that month since NAR began tracking the data in 1999. That combination of elevated prices and borrowing costs is intensifying financial strain on households, particularly younger buyers.
Housing affordability has become a flashpoint in the run-up to the midterm elections. A CNBC survey conducted in July found that voters aged 18 to 34 rank housing costs as a more urgent concern than food prices or protecting democratic institutions. Lawmakers have taken note: Congress passed a bipartisan measure earlier this year designed to boost supply and lower costs, but President Trump declined to sign it, objecting to the Senate’s failure to advance his voter ID proposal. The legislation took effect in July anyway.
As the political battle over housing intensifies, the latest NAR figures are likely to fuel further debate on the campaign trail. With mortgage rates showing no immediate signs of easing and prices still near record highs, the path to homeownership remains steep for many Americans.
