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US existing home sales fell to their lowest level since 2010
Sales of existing homes in the US fell to 3.75 million in October, their lowest level since August 2010, as higher borrowing costs and inflation deterred buyers. The decline highlights mounting pressure on housing affordability, which has also been a concern for voters amid rising living costs.
Sales were down 8.8% on a year earlier, while the median price edged up to $416,700. The average 30-year mortgage rate was about 7.18%, near a three-year high and well above pandemic levels of just over 3%; sales fell in the Midwest, South and West but held steady in the North-east. Economists cited financial uncertainty and seasonal factors, while the Federal Reserve was expected to raise interest rates again to curb inflation.
In short
- US existing-home sales fell to 3.75 million in October.
- Sales reached their lowest level since August 2010.
- Mortgage rates near 7.18% are weighing on affordability.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Higher interest rates and persistent inflation make it harder for households to afford a home, and falling sales alongside rising prices suggest that many buyers are being squeezed. Supporters of tighter monetary policy would argue that raising rates can help bring inflation under control, protecting purchasing power over time even if borrowing becomes more expensive in the short term.
The case against
High mortgage rates can put home ownership further out of reach and suppress sales, while prices have yet to fall enough to offset the added borrowing costs. Critics of further rate rises would argue that worsening affordability and financial uncertainty call for caution, especially when seasonal factors may also be contributing to the decline.
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Originally published by The Guardian as “Home sales hit 16-year low in October amid record-high mortgage rates”.