Existing-home sales rose more than expected in May, driven by lower mortgage rates

Existing-home sales in the United States rose more than analysts had expected in May, driven by more moderate mortgage rates than last year and improved affordability, according to data released Tuesday by the National Association of Realtors (NAR).

Sales rose 3.2% year-over-year and reached a seasonally adjusted annual rate of 4.2 million units.

"Improving affordability is helping drive this momentum," said Lawrence Yun, NAR’s chief economist, in a statement. "More Americans are on the move, with home sales rising to the highest level since December. This is great news for the housing market and the economy," he added.

Lower mortgage rates are boosting economic momentum

Although mortgage rates have risen slightly since the beginning of the year, they remain below May 2025 levels. The 30-year fixed-rate mortgage, the most popular among buyers, averaged around 6.5% at the end of May, compared to 6.9% a year earlier.

"Increased home sales mean more economic activity -- lawn care, furniture purchases, moving services, mortgage originations and other related business activities all get a boost," Yun explained.

The median price of existing homes rose 1.3% year-over-year to $429,300, the highest level since mid-2025.