It was reported This Week in Real Estate that new home sales exceeded expectations, that existing home sales realized another month of year-over-year growth, and Fannie Mae’s September economic and housing outlook projects a nearly 10% increase in total home sales in 2026, alongside a decline in mortgage rates to below 6% percent by year-end 2026. In August, new single-family home sales surged 20.5% month-over-month, reaching their highest level in over three and a half years, according to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. Economists noted that new housing data is extremely volatile and subject to revisions. Existing home sales experienced a slight monthly contraction of 0.2% in August. However, year-over-year figures rose by 1.8%, marking the second consecutive month of annual growth. Fannie Mae’s Economic and Strategic Research Group has revised its interest rate forecast, now anticipating mortgage rates to settle at 6.4% by the end of 2025 and decline further to 5.9% by the close of 2026. Concurrently, home sales are expected to grow nearly 10% year-over-year in 2026. Below are key events from the fourth week of September impacting our business:
EXISTING HOME SALES SHOW YEAR-OVER-YEAR GROWTH AGAIN. Existing home sales have shown year-over-year growth for two consecutive months, as mortgage rates have remained below 6.64% for the same period. August saw a 1.8% year-over-year increase in sales. Looking forward, purchase applications have just had their best eight weeks of the year, and this data line typically doesn’t reflect in the sales data until 30-90 days later. So, we can still see some growth in existing home sales as the year progresses. The growth of inventory has been one of the best stories in 2025 for the U.S. economy. However, with our own HousingWire Data on inventory, we’ve seen housing inventory growth slowing since mid-June, while still showing year-over-year gains. We went from 33% year-over-year growth down to 20% the last few months. Still, the most notable aspect of the housing market has been the increase in inventory, as price growth has cooled and is now showing a year-over-year increase of just 2.2%. Read the full story here.
NEW HOME SALES SOAR 20% IN AUGUST TO A THREE-YEAR HIGH. Sales of newly built homes rose a much larger-than-expected 20.5% in August compared with July to the highest level since January 2022, according to the U.S. Census. It is also the largest one-month gain since August 2022. Sales were 15.4% higher than August 2024. “We were expecting a gain but not that large,” said Robert Dietz, chief economist at the National Association of Home Builders. “Always important to remember the margin of error for new home sales is large. We’ll need to wait for revisions next month and the September data point to see if this is smoothed out.” Homebuilder analyst Ivy Zelman of Zelman & Associates said the number was “directionally right, but the magnitude was way too high.” Zelman conducts her own survey, which has a higher sample size spanning 15% of homebuilders, and it showed a sales increase of 6% year over year, she said. Strong sales took inventory down to a 7.4-month supply in August from a nine-month supply in July, a nearly 18% drop. Read the full story here.
HOME SALES TO JUMP NEARLY 10% IN 2026, FORECASTERS SAY. Fannie Mae’s Economic and Strategic Research Group now forecasts overall home sales – new and existing – will be 9.2% higher at the end of 2026 compared to the end of 2025. Existing home sales are expected to be at an annualized rate of 4.446 million at the end of 2026, up 9.6% compared to forecasts for the end of this year. The group also forecasts a steady decline in 30-year mortgage rates, which have fallen in recent weeks. It expects the rate to be at 6.4% by the end of 2025 and 5.9% by the end of 2026. The affordability picture is changing -and that could lead to the jump in home sales that Fannie Mae forecasters expect. “Mortgage rates have moderated, incomes continue to rise and house price growth is slowing – all signs that the affordability chains may be moving in the buyers’ favor,” said Mark Fleming, chief economist at First American. Read the full story here.
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