Sales of previously owned homes fell 5.5 percent in October from September to a seasonally adjusted annual rate of 3.75 million, the National Association of Realtors reported. Sales were down 8.8 percent from a year earlier. Lawrence Yun of NAR said it was the lowest pace since August 2010.

Yun pointed to borrowing costs. Mortgage rates "have climbed to their highest levels since 2000, aside from a single month in 2023," he said. He also said there is pent-up demand if rates decline.

Freddie Mac's average 30-year fixed rate was 7.33 percent in October, up from 6.86 percent in September and 6.25 percent a year earlier, according to NAR.

Where sales fell

Single-family home sales fell 5.8 percent to an annual rate of 3.41 million. Condominium and co-op sales fell 2.9 percent to 340,000, NAR said.

The West had the steepest drop. Sales there fell 9.7 percent from September and 14.5 percent from a year earlier.

Prices

Fewer sales did not mean lower prices. The national median price was $416,700 in October, up 0.4 percent from $414,900, NAR said. It was the 40th straight month in which the median was higher than a year earlier.

The West's median was $624,300, unchanged from a year earlier. In the Northeast, the median was $519,600, up 3.2 percent.

NAR's affordability index was 100.7, down from 107.3 a year earlier.

More homes, more time

There were 1.59 million homes for sale at the end of October, up 1.3 percent from September and 4.6 percent from a year earlier, according to NAR. At the current sales pace, that is a 5.1-month supply. It was 4.7 months in September and 4.4 months a year ago.

Homes sat a little longer. The median time on the market was 35 days, up from 33 days in September.

Who bought

First-time buyers made up 29 percent of sales, down from 31 percent in September and 32 percent a year earlier. Cash sales were 29 percent. Investors and second-home buyers bought 20 percent of homes. Distressed sales were 2 percent, NAR said.

Rates this week

Mortgage rates have eased since October's average. Freddie Mac's weekly survey, released Nov. 12, put the 30-year fixed rate at 7.11 percent, down from 7.18 percent the week before. It was the fourth straight weekly decline and the lowest level in seven weeks. A year ago the rate was 6.24 percent.

The 15-year fixed rate averaged 6.45 percent, down from 6.57 percent. A year ago it was 5.49 percent.

"Mortgage rates dropped to their lowest level in seven weeks, a welcome development that gives borrowers greater flexibility," said Sam Khater of Freddie Mac.

What it means for a buyer

October's report pulls in two directions. A buyer found more homes listed, a 5.1-month supply and sellers waiting a median of 35 days. The same buyer faced a median price above a year earlier and borrowing costs well above last year's.

Here is an example. A buyer shopping this week faces a Freddie Mac 30-year average of 7.11 percent. A buyer a year ago faced 6.24 percent. On the same loan amount, the higher rate means a higher monthly payment.

Freddie Mac's rate is a survey average, not an offer. What a borrower is quoted depends on that borrower's credit, down payment and lender.