Key Takeaways
- Existing-home sales fell 5.5% in October 2026 to a seasonally adjusted annual rate of 3.75 million, down 8.8% from a year ago and the lowest since August 2010.
- Inventory rose to 1.59 million homes, a 5.1-month supply, while the median price held at $416,700, up 0.4% for a 40th straight year-over-year increase.
- Investors and second-home buyers took 20% of sales, up from 16% a year ago, even as first-time buyers slipped to 29%.
- Distressed sales stayed at just 2% of transactions, so this is a volume collapse driven by rates, not a distress wave.
Existing-home sales fell harder than expected in October. The National Association of REALTORS® Existing-Home Sales report for October 2026, released November 12, put sales at a seasonally adjusted annual rate of 3.75 million.
That is down 5.5% from September and down 8.8% from October 2025. Economists polled by Reuters had forecast a 3.85 million rate, so the actual print missed consensus and set a new low for this cycle.
NAR Chief Economist Lawrence Yun said: “Home buying is difficult when mortgage rates have climbed to their highest levels since 2000, aside from a single month in 2023. As a result, home sales fell to their lowest level since August 2010.”
Sales Fell in Three Regions, and the West Fell Hardest
Month over month, sales declined in the Midwest, the South, and the West, and held steady in the Northeast. Year over year, sales declined in all four regions.
| Region (October 2026) | Annual sales rate | Month over month | Year over year | Median price |
|---|---|---|---|---|
| Northeast | 470,000 | Unchanged | -4.1% | $519,600, up 3.2% |
| Midwest | 900,000 | -3.2% | -8.2% | $324,300, up 1.5% |
| South | 1.73 million | -6.5% | -8.0% | $360,900, down 0.4% |
| West | 650,000 | -9.7% | -14.5% | $624,300, unchanged |
Single-family sales fell 5.8% to a rate of 3.41 million, down 8.6% from a year ago, at a median price of $421,900, up 0.4%. Condominium and co-op sales fell 2.9% to 340,000, down 10.5% from a year ago, at a median price of $365,100, up 0.3%.
The result lands close to what the early local data pointed to. Yesterday’s preview of early-reporting markets, covered in the early October sales preview that warned tomorrow’s NAR report could set a new cycle low, had sales down 13.7% year over year on an unadjusted basis, and the official seasonally adjusted figure confirmed the direction.
Inventory Rose to a 5.1-Month Supply, but Prices Did Not Break
Total housing inventory was 1.59 million units, up 1.3% from September and up 4.6% from October 2025. Unsold inventory represented a 5.1-month supply, up from 4.7 months in September and 4.4 months a year ago.
Yet prices did not fall nationally. The median existing-home price for all housing types was $416,700, up 0.4% from $414,900 one year ago, marking the 40th consecutive month of year-over-year price increases.
- Time on market: a median of 35 days, up from 33 days in September and 34 days in October 2025.
- First-time buyers: 29% of sales, down from 31% in September and 32% a year ago.
- Cash sales: 29% of transactions, up from 27% in September and unchanged from a year ago.
- Investors and second-home buyers: 20% of transactions, unchanged from September and up from 16% a year ago.
- Distressed sales: 2% of sales, unchanged from September and October 2025.
That mix matters for investors. The buyer pool is shrinking overall, a pattern also visible in Redfin’s October count, where sellers outnumbered buyers by a record 70.5%, but the investor share of what does sell rose four points in a year.
Affordability kept tightening. The Housing Affordability Index registered at 100.7, down from 107.3 one year ago, and affordability declined year over year in all four regions, led by the Northeast at down 8.7% and the Midwest at down 7.2%.
The average 30-year fixed-rate mortgage was 7.33% in October, according to Freddie Mac, up from 6.86% in September and 6.25% one year ago. October closings mostly reflect contracts signed in August and September, when that rate climb was already underway.
What This Low Actually Tells a Beginner Investor to Do
Yun pointed to the other side of the trade: “Despite fewer transactions in October, the 88 million homeowners across the country are largely in a comfortable financial position due to sizable housing wealth accumulation. The number of distressed property sales remains historically low at only 2% of all transactions.”
He added: “Based on the current underwhelming home sales pace at a time of consistent job growth, there could be sizable pent-up demand if mortgage rates decline.”
Those two quotes set the strategy. There is no distress flood to wait for, and there is a large pool of sidelined demand that returns if rates fall, which is exactly why waiting for a crash is the wrong plan here.
- Do not underwrite a deal on distress pricing. With distressed sales at 2% and prices still rising year over year for a 40th straight month, buy on current rent and cash flow, not on a hoped-for discount.
- Use the longer marketing time. At a median of 35 days on market and a 5.1-month supply, sellers have less leverage than a year ago; inspections, credits, and rate buydowns are negotiable in a way they were not at a 4.4-month supply.
- Respect the lock-in effect. Most owners still hold far cheaper loans than today’s 7.33% October average, a gap detailed in the Realtor.com lock-in analysis showing moving would cost the typical holder 85.3% more a month, so new listings stay scarce even as sales fall.
- Position before a rate drop, not after one. Yun’s pent-up demand point means a meaningful rate decline brings buyers back fast; an investor who buys at today’s slower pace competes with fewer bids than one who waits for the headline to turn.
Data: National Association of REALTORS®, Existing-Home Sales report for October 2026, released November 12, 2026. Consensus forecast of 3.85 million reported by Reuters, November 12, 2026.
