Buyers Start to Creep Back as Existing Home Sales Top Forecasts — Evening Brief – 03.10.26

U.S. existing home sales posted a modest rebound in February, offering a tentative sign that lower mortgage rates and easing price pressures are starting to pull some buyers off the sidelines 

Sales of previously owned homes rose 1.7% month-over-month to a seasonally adjusted annual rate of 4.09 million, topping economist expectations of 3.88 million and improving from a revised 4.02 million pace in the prior month, according to new data from the National Association of Realtors. 

Housing affordability also showed gradual improvement. The Housing Affordability Index increased to 117.6 in February, up from 117.1 in January and well above the 103.1 reading recorded a year earlier. Gains were seen across all four major U.S. regions, led by the West with a 17% improvement, followed by the South at 14%. 

“Housing affordability is improving, and consumers are responding,” said Lawrence Yun, Chief Economist at the National Association of Realtors. “Still, there is a long way to go to return to pre-pandemic levels of transaction activity.” 

Yun noted that despite strong labor market conditions—with roughly 6 million more jobs in the U.S. compared to 2019—annual home sales remain about 1 million units below pre-pandemic levels. 

Home prices continued to climb modestly. The median existing-home price reached $398,000, up from $395,000 in January and $396,800 a year earlier. 

Inventory also improved slightly, rising 2.4% month-over-month to 1.29 million homes, equivalent to a 3.8-month supply, unchanged from the prior month but above the 3.6 months recorded a year ago. 

Even with the uptick in activity, demand remains restrained. “Wage growth is now outpacing home price growth by almost four percentage points,” Yun said. “Mortgage rates are also measurably lower compared to a year ago.”