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Sales of existing homes fall to their lowest level in 28 years

As home buying plunges, the median home price reaches a new all-time high of $389,800.

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A new report from the National Association of Realtors (NAR) indicated that last year the sale of existing homes sank to its lowest level in 28 years, reaching 4.09 million (the lowest level since 1995):

Annually, existing home sales (4.09 million) fell to the lowest level in nearly 30 years.

Home sales fell 1% in December. Sales are down 6.2% compared to 2022:

Total existing-home sales (completed transactions that include single-family homes, townhomes, condominiums and cooperatives) decreased 1.0% from November to a seasonally adjusted annual rate of 3.78 million in December. Year over year, sales declined 6.2% (down from 4.03 million in December 2022).

Likewise, "the inventory of unsold existing homes slumped 11.5% from the previous month to 1 million at the end of December, or the equivalent of 3.2 months' supply at the current monthly sales rate."

Home prices reach a new high

On the other hand, the average price of a home reached an all-time high of $389,800. According to the report, "the median existing-home sales price rose 4.4% from December 2022 (...) the sixth consecutive month of year-over-year price increases."

NAR Chief Economist Lawrence Yun warned that the rapid increase in home prices is "unsustainable."

If price increases continue at the current pace, the country could accelerate into have and have-nots (...) Creating a path to homeownership for today's renters is essential. It requires economic and income growth and, most importantly, a steady buildup of home construction.