Home Sales in October Plummet to 16-Year Low

High prices, high interest interest rates. I'm surprised people aren't buying.

Home Sales in October Plummet to 16-Year Low

Sales of existing homes declined 5.5% from the previous month, dropping the level of sales to the lowest point since the subprime crisis period

By Nicholas G. Miller, WSJ

Updated Nov. 12, 2026 12:08 pm ET

Home sales declined in October to their lowest level since 2010, a new trough for a housing market that has been hovering near rock bottom for more than four years.

Sales of existing homes fell 5.5% to a seasonally adjusted annual rate of 3.75 million, the National Association of Realtors said Thursday, marking the steepest decline since January. Economists surveyed by The Wall Street Journal expected a decline of 3.8%.

The last time sales were this low was August 2010 when the economy was still reeling from the housing bust and the recession that followed. Sales fell 8.8% from last October, which marked the largest year-over-year decrease since 2023.

The October sales mostly reflect purchase contracts signed in September, when a selloff in the bond market caused mortgage rates to take off beyond 7%. Real-estate agents and mortgage lenders have reported that ever since then, open houses have gone quiet and buyers have stopped their search.

Rates rose even higher in October, indicating that the worst sales numbers may be yet to come; 30-year mortgage rates fell to 7.11% from 7.18% last week, the fourth consecutive week of declines, according to Freddie Mac. A year expected to herald the housing market’s resurgence is instead drawing to a close on a dour note.

The national median existing-home price in October rose 0.4% from a year earlier, to $416,700, NAR said. Prices have largely leveled off as mortgage rates have frozen demand, but they have still crept to record levels as homeowners have held on to their low mortgage rates from years ago, hurting inventory.

“We’re really in uncharted territories when you’re talking about record sale prices coupled with higher interest rates,” said Christina Ray, an agent in Denver.

The historically low sales rate in October appears even more extraordinary given optimism near the start of the year that the housing market would begin to recover.

Mortgage rates briefly touched below 6% in February, spurring a flurry of buyer activity and belief that home sales were on their way back to prepandemic levels. They jumped after the U.S. attacked Iran and have continued rising as the war has drawn on and artificial-intelligence firms spend wildly, which together have boosted inflation.

Now, after repeatedly seeing its predictions for a looming recovery turn sour, the housing industry is downbeat again. “Everyone seems to be waiting for the rates to drop and I’m just not super optimistic that that’s going to be happening next year. So, I think we need to navigate the market that we’re currently in,” Ray said.

Mortgage rates are likely to remain elevated next year as the Federal Reserve faces pressure to continue raising short-term interest rates to fight stubborn inflation, economists say.

The Labor Department said this week that consumer prices rose by 0.4% in October, which surpassed expectations. That caused 10-year Treasury yields, which mortgage rates track, to rise.

Goldman Sachs Research economists forecast last month just 3.9 million existing home sales in 2027, compared with well above 5 million before the pandemic. The last time sales for a calendar year came in below 4 million was 1995.

The disappearance of many prospective buyers as rates have risen has given those who can stomach the higher costs more leverage. Sellers have been offering significant concessions, often to help buyers buy down their mortgage rates. Ray said that 65% of October closings in the Denver market included seller concessions.

For John Krueger, the retreat of other buyers presented an opportunity in the booming area of Northwest Arkansas. Without much competition, he closed on a house last month originally listed at $540,000, for $490,000. His job in financial services allowed him to get an adjustable-rate mortgage with a lower initial rate of 6.15%.

“I know that sadly a home’s not affordable for very many,” he said. “I knew there wouldn’t be a ton of buyers.”