United States existing-home sales rose sharply in May, reaching their highest level since December as improving affordability and stronger buyer activity helped support the housing market despite elevated mortgage rates.
According to the National Association of Realtors' Existing-Home Sales report, sales increased 3.2% from April and were also up 3.2% compared with the same month a year earlier.
On a regional basis, monthly sales gains were recorded in the Northeast, Midwest and South, while activity was unchanged in the West. Compared with a year earlier, sales increased in the Midwest, South and West but declined in the Northeast.
“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,” said NAR Chief Economist Dr. Lawrence Yun.
“Improving affordability is helping drive this momentum. Even with mortgage rates ticking up compared to earlier in the year, they remain lower than a year ago and are essentially at the long-term historical average. Income gains are also outpacing home price growth by a small margin in most parts of the country.”
Yun also highlighted the financial strength of homeowners, noting that distressed sales remained rare.
“Only 1% of all home sales involved a foreclosure or an underwater situation in which the sale price could not cover the outstanding mortgage balance. This shows that homeowners are on solid financial footing,” Yun added.
Housing supply continued to improve during the month. Inventory rose 3.3% from April to 1.55 million homes available for sale and was up slightly from a year earlier.
At the current pace of sales, the inventory represents a 4.5-month supply of homes, still below the six-month level generally considered a balanced market between buyers and sellers.
Despite the increase in listings, limited supply continued to support home values. The median existing-home sale price climbed 1.3% from a year earlier to $429,300, marking a record high for the month of May.
The upper end of the market remained the strongest-performing segment. Sales of homes priced above $1 million increased 11% from a year earlier, benefiting from greater inventory availability and buyers who are generally less sensitive to mortgage rate movements.
In contrast, sales of homes priced between $100,000 and $250,000 declined 5% year-over-year, reflecting ongoing affordability challenges for entry-level buyers.
First-time buyers increased their presence in the market during May, accounting for 35% of transactions, up from 33% in April and 30% a year earlier.
The increase suggests improving affordability conditions are encouraging more new entrants into the housing market.
Properties also sold more quickly. Homes remained on the market for an average of 29 days, down from 32 days in April, although slightly above the 27-day average recorded in May 2025.
Cash purchases accounted for roughly one-quarter of all transactions, easing slightly compared with the same period last year.
