Sales of previously occupied U.S. homes fell in January as rising mortgage rates and prices put off many would-be homebuyers despite a wider selection of properties on the market.
Sales fell 4.9% last month from December to a seasonally adjusted annual rate of 4.08 million units, the National Association of Realtors said Friday.
Sales rose 2% compared with January last year, marking the fourth straight annual increase. The latest home sales, however, fell short of the 4.11 million pace economists were expecting, according to FactSet.
The Baton Rouge area largely fell in line with national trends in January—sales fell 34% last month from December and rose 7.2% compared to January of last year.
Home prices increased on an annual basis for the 19th consecutive month. The national median sales price rose 4.8% in January from a year earlier to $396,900.
“Mortgage rates have refused to budge for several months despite multiple rounds of short-term interest rate cuts by the Federal Reserve,” says Lawrence Yun, NAR’s chief economist. “When combined with elevated home prices, housing affordability remains a major challenge.”
The U.S. housing market has been in a sales slump dating back to 2022, when mortgage rates began to climb from pandemic-era lows. Sales of previously occupied U.S. homes fell last year to their lowest level in nearly 30 years.
