November Home Sales Rise But Inventory Crunch Threatens 2026 Buyers

The housing market delivered mixed signals in November. Existing home sales rose 0.5% to a seasonally adjusted annual rate of 4.13 million units—the highest level since February and the third consecutive monthly increase. Lower mortgage rates and strong wage growth are helping buyers. But the supply side of the market is flashing warning signs.

The Sales Picture

November's increase puts home sales on modestly firmer footing heading into 2026. The gains were led by the Northeast (+4.1%) and South (+1.1%), while the Midwest declined 2.0% and the West was flat.

The median existing-home price hit $409,200—up 1.2% from November 2024 and the highest November reading on record. It marked the 29th consecutive month of year-over-year price increases. Despite affordability challenges, the fundamentals supporting prices remain intact.

The Inventory Problem

Here's where it gets concerning: total housing inventory fell 5.9% from October to 1.43 million units. While inventory is up 7.5% compared to November 2024, the month-over-month decline is unusual for this time of year—and points to a deeper issue.

NAR Chief Economist Lawrence Yun explained: "Inventory growth is beginning to stall. With distressed property sales at historic lows and housing wealth at an all-time high, homeowners are in no rush to list their properties during the winter months."

Translation: sellers who locked in sub-4% mortgage rates during the pandemic have little incentive to sell and take on a new mortgage at 6%+. This "lock-in effect" continues to constrain supply even as demand recovers.

Who's Buying

First-time buyers accounted for 30% of November sales—still well below the historical norm of around 40%. The affordability math remains brutal for entry-level purchasers, especially in high-cost markets.

All-cash buyers represented 27% of transactions, reflecting the continued presence of investors and wealthy move-up buyers who don't need financing. Cash offers remain a significant competitive advantage in tight markets.

Mortgage Rates: The Key Variable

The average 30-year fixed mortgage rate in November was 6.24%, according to Freddie Mac—the lowest level in over a year. Rates have since drifted back toward the high 6% range, but remain well below the 8% peak of late 2023.

Rate movements will determine whether the recent sales momentum continues. The Federal Reserve's December rate cut and guidance suggesting fewer cuts in 2026 has added uncertainty to the mortgage rate outlook.

Regional Highlights

The Northeast showed the strongest momentum, with sales rising to an annual rate of 520,000 units—up 10.6% from a year ago. Median prices in the region hit $485,100.

The South remains the largest market, accounting for 1.83 million annual sales. Prices there have moderated compared to other regions, making Sun Belt markets relatively more accessible.

Days on Market

Properties typically remained on the market for 36 days in November, compared to 32 days last year. The slight increase suggests the market is normalizing from the frenetic pace of 2021-2022, when homes sold in days rather than weeks.

The 2026 Outlook

The combination of recovering demand and constrained supply points to continued price appreciation in 2026. NAR projects existing home sales to rise modestly, reaching 4.5 million units—still below the pre-pandemic norm of 5+ million.

For buyers, the message is clear: waiting for a crash has been and remains a losing strategy. For sellers, the power dynamic hasn't shifted. Those who do list will find motivated buyers in a market still characterized by structural undersupply.

The Bottom Line

November's home sales data shows a market gradually healing but still facing fundamental constraints. The lock-in effect, tight inventory, and affordability challenges will define housing in 2026. Buyers hoping for relief may need to adjust expectations—or wait longer than they'd like.