In an unexpected turn, homebuying activity surged in November as the impact of election uncertainty waned and prospective buyers adapted to persistent high mortgage rates. This marked a significant recovery in the housing market, reaching the highest level in over a year and a half.
Existing home sales increased by 0.7% month over month in November, achieving a seasonally adjusted annual rate of 4,269,851—the highest since March 2023. This is also a 4.5% rise from the previous year, marking the greatest annual growth since July 2021. A seasonally adjusted annual rate, while not an exact count of sales, indicates the pace if sales continued steadily throughout the year.
Elijah de la Campa, a senior economist, noted that as the uncertainty of elections subsided, house hunters began to understand that waiting would not likely result in lower mortgage rates. Consequently, sales activities saw an uptick, with expectations that 2025 could see even further increases.
The average interest rate for a 30-year mortgage reached 6.81% in November, which, although the highest since July, remains below the 7.44% observed in November 2023. The hike in rates last fall was the highest in over two decades, contributing to the significant year-over-year sales increase observed recently.
Overall, home sales—including old and new homes—increased by 2.2% month over month, reaching the highest level in over two years when adjusted seasonally. Year-over-year sales grew by 7%, the largest jump since June 2021. Pending sales also saw a modest rise of 0.4% month over month, and a 5.7% year-over-year increase brought them to the highest level since February 2023.
Rafael Corrales, a real estate agent based in Miami, observed a noticeable increase in buyer demand almost immediately after election results were announced. This rise in interest was reflected in a higher number of home-tour requests, although the volume of home listings did not match this increase.
The median sale price of homes in November reached $430,107, a 5.4% increase from the previous year, marking the largest annual gain since April. The price hike was driven by a continued shortage of homes for sale. New listings decreased by 1.6% from the previous month and were down by 4.8% from the previous year. Despite this slump in new listings, active listings—representing all homes on the market—continued to rise due to homes staying on the market longer.
Data from metro areas showed varied trends, with significant price increases in cities like Philadelphia, Newark, and St. Louis, while decreases were noted in Tampa and Dallas. Pending sales saw significant growth in Seattle and Jacksonville, contrasting with notable declines in Miami and West Palm Beach. Active listings saw the most growth in Cincinnati and Fort Lauderdale, while some areas like Newark experienced a drop.
A significant percentage of homes in Newark, et al., sold above their final list price, indicating strong demand in these markets. This trend differed in cities such as West Palm Beach and Miami, where the percentages were notably lower.
The housing market’s recent recovery indicates growing buyer confidence in navigating high mortgage rates and adapting to market shifts post-election. As 2025 approaches, expectations for increased activity persist, suggesting a potential for further market expansion despite ongoing challenges.
Source: Redfin
