Existing home sales in the United States fell sharply in January 2026, dropping by 8.4% compared to December to a seasonally adjusted annual rate of 3.91 million units. This marks the largest monthly decline in nearly four years and the lowest level since late 2023, according to a report from the National Association of Realtors.
Sales were also down 4.4% compared to the same month last year, with declines recorded across all four major regions despite improved affordability and lower mortgage rates.
The housing affordability index rose to 116.5 points, its highest level since March 2022. This indicates that a median-income household is theoretically able to afford a median-priced home. However, the association’s chief economist, Lawrence Yun, attributed part of the weak sales performance to adverse weather conditions, emphasizing that limited inventory remains the biggest obstacle.
Meanwhile, the national median home price increased 0.9% year-over-year to reach $396,800, setting a new January record. The rise was supported by a continued shortage of supply, with available inventory standing at 1.22 million units—enough to cover only 3.7 months of sales, well below the six months typically considered a balanced market.
Regionally, sales declined in the Northeast, Midwest, South, and West, with the Western region being the only area to record an annual drop in prices.
Sales of single-family homes fell by 9%, while condominium sales declined by 2.6%. The average time a property remained on the market increased to 46 days, and the average rate on a 30-year fixed mortgage reached 6.10% in January. Analysts believe that an increase in housing supply during the spring season will be the key factor in determining market direction during the first half of 2026.
