November home sales struggle as supply stalls

High home prices, stubbornly high mortgage rates, and now low supply are all weighing on potential homebuyers.

Sales of previously owned homes rose just 0.5% in November from October and were 1% lower than in November 2024, according to the National Association of Realtors. Sales came at an annual rate of 4.13 million units.

This number is based on closings, so it reflects contracts that were likely to be signed in September and October, when mortgage interest rates initially fell slightly but then remained in a narrow range.

Supply, which had been rising for most of this year, fell in November. There were 1.43 million homes for sale at the end of the month, down 5.9% from October but up 7.5% year over year, according to the association. At the current sales pace, that represents a 4.2-month supply. The six-month offer is considered balanced between the buyer and the seller.

“Inventory growth is starting to stall,” Lawrence Yun, chief economist at the brokerage, said in a statement. “With distressed property sales at historic lows and housing wealth at all-time highs, homeowners are in no rush to list their properties during the winter months.”

Sellers on the market have also begun delisting their properties at a higher rate than usual. Sellers often pull unsold homes off the market come winter, but that dynamic was much stronger this year.

This keeps pressure on housing prices. The median price of a home sold in November was $409,200, an increase of 1.2% from November 2024, and the highest November reading ever. Brokers use an average measurement, which can be skewed to the best-selling end of the market. The upper bound is currently performing much better than the lower bound. Sales of homes priced between $100,000 and $250,000 were down nearly 8% from a year ago, while prices for homes priced above $1 million were up 1.4%.

“Wage growth outpaces house price gains, improving housing affordability. However, affordability could be hampered in the future if housing supply fails to keep up with demand,” Yoon said.

Homes are staying on the market longer, at 36 days compared to 32 days last November. First-time homebuyers make up 30% of sales, unchanged from last year, but historically they make up about 40%. Investors returned to the market, accounting for 18% of transactions, up from 13% in November 2024.