Existing home sales in December increased by 5.1% from the previous month. However, it was not enough to bring 2025 above the previous year’s level.
Existing home sales ended 2025 on an upward trend, according to the National Association of Realtors’ December market report. But it wasn’t enough to push sales above 2024 levels.
Existing home sales increased 5.1% from the previous month to a seasonally adjusted annual rate of 4.35 million. Sales also increased on an annual level (up 1.4%), with increases in the South compared to the previous year, flat sales in the Midwest and West, and a slight decrease in the Northeast.
Lawrence Yun
“2025 was another tough year for homebuyers, marked by record home prices and historically low home sales,” NAR Chief Economist Lawrence Yun said in the report. “However, the situation started to improve in the fourth quarter, with lower mortgage rates and slower house price growth.
“December home sales, adjusted for seasonal factors, were the highest in nearly three years. Growth was broad-based, with all four major regions improving from the previous month.”
After increasing significantly earlier this year, inventory levels shrunk in December, dropping 18.1% to 1.18 million units. This is equivalent to 3.3 months’ supply at current sales pace.
“Inventory levels remain tight,” Yun said. “With fewer sellers willing to move, homeowners are taking their time deciding when to list or delist their homes. As in past years, we expect more inventory to hit the market starting in February.”
Daniel Hale, chief economist at Realtor.com, said December’s sales increase wasn’t enough to propel 2024 sales ahead, with this year just a razor’s edge away.
Daniel Hale |Credit: Realtor.com
“4,061,000 homes were sold in 2025, compared to a total of 4,062,000 in 2024,” she said in an emailed statement. “This means that total annual sales in 2025 will be the lowest since 1995, but by only 1,000 homes.”
Still, Hale is cautiously optimistic about 2026, as mortgage rates and median house price growth (+0.4%) remain at the lower end.
“December homebuyers who would have signed contracts in October and November benefited from interest rates near their lowest levels in a year. Fortunately, mortgage rates have not increased since then,” he said. “There is no shortage of potential drivers for mortgage rates, from the recently announced MBS purchase program to macro factors such as employment and inflation.”
“So far, these factors have largely offset each other, keeping interest rates at stable to slightly lower levels.”[. That’s] “This is good news for homebuyers and we expect this trend to continue into 2026. This should increase the resilience of sales over the coming year,” she added.
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