U.S. Home Sales Slide as Housing Costs Push Buyers Out

Existing-home purchases nationwide have slowed to a pace not seen in over 16 years. October sales totaled 3.75 million, an 8.8% decrease from the previous October. Borrowing costs are a major obstacle: the average 30-year fixed mortgage rate stands at 7%, near a generational high. Although prices have declined in certain markets, many households still cannot afford available homes.

Jessica Lautz, a National Association of Realtors economist and research executive, said first-time buyers face particular difficulty finding an affordable property while also saving for a down payment and covering other expenses. Supply remains constrained by years of underbuilding, along with labor, land, regulatory and construction costs. Many owners with mortgages carrying 2% to 3% rates also have little incentive to move and take on today’s higher borrowing costs.

The West has been hit especially hard because home prices make moving and finding another property difficult. That regional pressure is particularly relevant to Spokane residents considering a purchase or move. Lautz said households earning below $75,000 will probably struggle to find an affordable property in most parts of the country. Interest rates are expected to remain around their current level, continuing to challenge buyers.