August Existing-Home Sales Fall Less Than Expected as Mortgage Rates Drop

02:53 PM EDT, 09/25/2025 (MT Newswires) -- Existing home sales in the US dropped less than projected in August as mortgage rates decreased, data from the National Association of Realtors showed Thursday.

Sales fell 0.2% sequentially to a seasonally adjusted annual rate of 4 million units last month. The consensus was for a 1.5% decrease in a survey compiled by Bloomberg.

"Home sales have been sluggish over the past few years due to elevated mortgage rates and limited inventory," NAR Chief Economist Lawrence Yun said. "However, mortgage rates are declining and more inventory is coming to the market, which should boost sales in the coming months."

The average 30-year fixed-rate mortgage decreased to 6.59% in August from 6.72% the previous month, the NAR said, citing Freddie Mac data. The median sales price of existing homes rose 2% year over year to $422,600 last month, marking the 26th straight month of annual gains, according to the NAR.

Single-family home sales fell 0.3% sequentially to 3.63 million units in August, while condominium and co-op sales held steady at 370,000 units, the data showed.

Last week, the Federal Reserve lowered its benchmark lending rate by 25 basis points, noting increased downside risks to employment and signaling further monetary policy easing later in 2025.

"The pullback in interest rates will boost affordability and support home-buying over the near-term, but judging from the moderate upticks in weekly mortgage purchase applications, only a moderate improvement in sales appears to be in the cards," Admir Kolaj, an economist at TD Economics, said in a report published Thursday. "This contributes to residential investment being a drag on the economic outlook over the near term."

On Wednesday, the Mortgage Bankers Association said mortgage applications in the US increased last week as the 30-year fixed rate on conforming loans reached the lowest since September 2024. Official data showed that US new home sales in August hit the highest level since January 2022 even as prices increased.

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