Home Sales Surge to 5-Month High Powered by Uptick in First-Time Buyers

Existing-home sales increased by 3.2% month over month and year over year in May, reaching a seasonally adjusted annual rate of 4.17 million, the highest level since December, according to the National Association of Realtors® (NAR). This surge was attributed to improved affordability and rising incomes, which encouraged more first-time homebuyers. Sales saw increases in the Northeast, Midwest, and South compared to April, while remaining unchanged in the West. On an annual basis, sales grew in the Midwest, South, and West, with a decline in the Northeast. NAR Chief Economist Lawrence Yun highlighted that the strong momentum in closings indicates a healthy housing market and economy, noting that while mortgage rates have slightly increased from earlier in the year, they are still lower than a year ago and align with the historical average. Single-family home sales rebounded by 3.5% month over month to 3.8 million properties, a 3.3% increase from May 2025, while condominium and co-op sales remained flat for the month but were up 2.8% year over year. The median sales price for existing homes rose 1.3% from May 2025 to $429,300, marking a new record high for the month, which Yun attributed to strong homeowner fundamentals and persistent supply limitations. Foreclosures or underwater sales represented only 1% of all transactions, indicating homeowners are financially stable. The Midwest region led monthly gains with a 6.4% increase to an annual rate of 1 million sales, followed by the South with a 3.2% monthly gain to 1.96 million sales.