Existing Home Sales: Activity Rebounds as Supply Tightens, Prices Stay Flat

The latest existing-home data shows a familiar 2026 pattern: transactions are improving, supply is tightening in the short run, and prices remain essentially flat. In other words, the market is moving again, but it is not delivering strong price momentum.

Sales are clearly rebounding. Existing home sales rose 5.1% month over month, with the 3-month moving average up 2.4% and sales up 1.4% year over year. Single-family sales tell the same story: up 5.0% month over month, up 2.4% on a 3-month basis, and up 1.8% year over year. That combination matters. A one-month jump can be noise, but when the 3-month average and year-over-year numbers are also positive, it suggests demand is becoming more consistent rather than just producing a one-off spike.

Supply, however, tightened sharply in the latest month. Housing inventory for existing homes fell 18.1% month over month (and 7.8% on a 3-month basis), while months’ supply fell 21.4% month over month (and 9.2% on a 3-month basis). Single-family supply metrics show the same direction: inventory down 14.4% month over month and months’ supply down 17.5% month over month. This is the kind of short-term move that can quickly shift the buyer experience on the ground: fewer listings, more competition for well-priced homes, and a faster decision cycle.

But the year-over-year picture is less tight than the month-to-month shock suggests. Inventory is still higher than a year ago: up 3.5% for all existing homes and up 8.1% for single-family homes. Months’ supply is also higher year over year: up 3.1% (all homes) and up 6.5% (single-family). That year-over-year cushion helps explain why prices are not accelerating even as sales improve.

Prices are soft in the short run and nearly flat over the year. The median sales price for existing homes fell 1.1% month over month and is down 0.6% on a 3-month basis, yet is up only 0.4% year over year. Single-family prices look similar: down 1.4% month over month, down 0.7% over three months, and up just 0.2% year over year. This is not a market screaming “breakout.” It is closer to a market stabilizing—where affordability constraints and still-elevated financing costs keep price growth contained.

How to interpret the current setup

1. The market is thawing, but not overheating. Sales are rising, which often happens when buyers adjust to a “new normal” in rates or when pent-up demand starts to reappear. However, muted year-over-year price gains suggest demand is not strong enough to generate broad-based pricing power.

2. Short-term supply moves can change negotiating dynamics quickly. The steep month-over-month declines in inventory and months’ supply can create local pockets of competitiveness—especially for homes that are well-located, well-maintained, and priced close to recent comparable sales. Even in a flat price environment, “the good ones” can still receive multiple offers.

3. The year-over-year supply increase is the anchor. Higher inventory versus last year is a structural offset that reduces the odds of runaway price growth. Unless the year-over-year supply trend flips meaningfully lower, it will be hard for prices to accelerate for the overall market.

What this means for buyers and sellers

For buyers, the data argues for speed without overpaying. Short-term supply is tighter, so preparation matters (pre-approval, clear decision criteria, quick scheduling). But the nearly flat year-over-year price trend supports negotiation when a listing is stale, overpriced, or needs work.

For sellers, the message is: you can get activity, but you must earn the price. With price growth near zero over the year, “test-the-market” pricing is riskier. The best approach is to price near comps early, maximize presentation, and be open to financing-related incentives if needed.

Bottom line

Existing home sales are improving (+5.1% month over month), supply tightened sharply in the latest month (inventory -18.1%, months’ supply -21.4%), but prices remain essentially flat year over year (+0.4%). This looks like a market in motion, not a market in boom mode—where transaction volume can recover while pricing stays restrained.