The NAR blames the weather for an 8.4 percent plunge.
NAR Blames the Weather
The National Association of Realtors notes Disappointing Existing-Home Sales in January.
“The decrease in sales is disappointing. The below-normal temperatures and above-normal precipitation this January make it harder than usual to assess the underlying driver of the decrease and determine if this month’s numbers are an aberration,” said NAR Chief Economist Dr. Lawrence Yun. “Affordability conditions are improving, with NAR’s Housing Affordability Index showing that housing is the most affordable it’s been since March 2022. This is due to wage gains outpacing home price growth and mortgage rates being lower than a year ago. However, supply has not kept pace and remains quite low.”
Is Plunge Weather Related?
December was mild. January wasn’t.
I don’t recall anyone blaming good weather for the good December statistics.
Moreover, existing-home sales are recorded at closing, not purchase time. Closings typically take 45-60 days.
Thus, January sales mostly represent contracts signed in November or December. Cash sales may be quicker.
But cash sales were only down a percentage point from 28 percent in December to 27 percent in January.
Key January 2026 Statistics
- Sales Month-Over Month: 8.4% decrease in existing-home sales—seasonally adjusted annual rate of 3.91 million in January
- Inventory Month-Over-Month: 0.8% decrease in unsold inventory—1.22 million units equal to 3.7 months’ supply
- Sales Year-Over-Year: 4.4% decrease in existing-home sales
- Median existing-home price: $396,800 for all housing types, up 0.9% from one year ago ($393,400) – the 31st consecutive month of year-over-year price increases.
- Market Time: 46 days, median time on market for properties, up from 39 days last month and 41 days in January 2025.
Existing-Home Sales Percent Change from Year Ago
Existing-home sales Median Sales Price
The string of 31 consecutive year-over-year increases in median price is poised to break next month if there is any further decline in price.
January typically marks the bottom. Nonetheless, my guess is the streak ends.
Existing-Home Sales Supply
The seasonality in many of these charts is obvious. It would be smart for the NAR to seasonally adjust these numbers, but they don’t.
This makes month-over-month comparisons difficult.
Existing-Home Sales vs Mortgage Rates
The Mirage of Improving Affordability
This is the key chart.
The average mortgage rate has declined from 7.62 percent in October of 2023 to 6.10 percent in January of 2026. That’s a decline of 1.52 percentage points.
Existing home sales essentially flatlined the entire time with minor bounces that never lasted.
NAR chief economist Lawrence Yun was a continual cheerleader as rates fell. But homes did not get more affordable, and still aren’t affordable.
Rising home prices, property taxes, maintenance costs, and especially home owners insurance chewed up any decline in mortgage rates.
Median Price
What does one get for these rising median price? Are lot sizes getting bigger? More rooms? Better schools? Anything?
Median price is a flawed statistic because it doe not address any of those questions. The Case-Shiller price index does.
Case-Shiller Home Prices Rise Again, 10-City Index Ties Record High
On December 30, I noted Case-Shiller Home Prices Rise Again, 10-City Index Ties Record High
Hello. Let’s discuss affordability again.
Existing Home Sales
Existing-Home sales have been flat since October of 2022 at roughly 4,000,000 annualized sales for three full years. Only price insensitive buyers have been buying.
Trump Says He “Wants to Drive Up Housing Prices”
On January 30, Trump made some economically illiterate comments sure to displease anyone struggling to buy a home.
Please consider Dear Zoomers, Trump Says He “Wants to Drive Up Housing Prices”
Somehow, I doubt Gen Z will like this message.
Homeowners insurance and property taxes are big affordability factors.
When prices rise, so do property taxes (except where capped), and so does homeowners insurance and maintenance costs.
Neither homeowners insurance nor property taxes are in the CPI, PCE, or Truflation indexes. All of the inflation measures are fatally flawed.
For discussion please see Is Homeowners Insurance Understated in the CPI? Shop Around!
Our Insurance went up by $2,000. Then another $2,000. Here’s our story.
Trump’s message is nonsense, even for those who own their own home.
Addendum
I made a few minor edits on closing times above. The edits decrease the likelihood of a huge weather influence.
December was mild. January wasn’t. (More Propaganda
To Coverup The ‘Decline’.!
The Weather Has Been Above Normal In Colorado.
January + February Both ‘Mild’.!
Temps Between 50 – 70 Degrees – 3 Light Snows So Far.!
Nice article, thanks. I wonder what the early signs of deflation would look like, and how we would distinguish something like that from a few “down months.” What would be the signs?
These numbers are also not taking into account the number of pulled listings.
Sales are sales – What do pulled listing have to do with it?
the good inventory in the right palces with the right people doing the right thing in them are inexorably ensconsed because the occupants understand value which goes on beyond relation to price
people walled up with each other with common core values create a protective barrier …and it goes unspoken they just know. the sleeping giant knows
Mish, let’s name this series of writings, “Calling it Bullshit.”
Monthly sales have flat-lined for more than 3 years. January’s number is testing the lower support. I think support is finally going to give.
Volume has been so low it’s hard to tell what’s noise and what’s a trend.
On a 30 year K$500 mortgage that 1.52% would mean you pay $507 less per month ($3.030 instead of 3.537), total amount $1.090.791 instead of $1.273,410.
That means you could afford a 584,000 mortgage for a house priced $84,000 higher for the same monthly payment at 6.1% as at 7.62%, which implies, all things (disregarding taxes and insurance; the economy; incomes) being equal, house prices should appreciate.
Overpriced
Redfin lets you flag houses, but they don’t remove the flag when it’s pulled, so if it’s relisted, it shows up as new, but with your flag.
The ones that got pulled last year are showing back up (as new listings) with a 10-15% price drop (you gotta get the price history from realtor.com, because Redfin will hide the history if they resist).
It appears people are getting the message. Will it boost sales, or will volume continue to crash?
Even if you put all the homeless in luxury condos, there still would be a flood of empty unsold, unrented units. The end of condo flipping.
I just returned from a quick trip to Florida and observed a high end condo market in shambles!
A place I looked at last year for $6 million was now asking $3.9 million, another lesser unit that was priced at $2.5 million (whisper “they’ll take $1.5)…
If it Flys, Floats or is in Florida? RENT IT!
“Moreover, existing-home sales are recorded at closing, not purchase time. Closings typically take 45-60 days.”
Exactly. Weather in January had effectively 0% impact on the closing date.
Other than a strange exception, due to an anomaly, one can never blame the weather for much of anything. It’s probably the most unpredictable thing, that we can’t control, but that somebody would Love to be able to.
Of course we have the NAR waving the BS Weather Flag, but they would wave any flag to get sales going again. Unfortunately it’s the Banks and Builders Job to do that. Anything, for the “Correct / Market Price, Will Sell to someone nearly always.
Things will only get worse from here for housing. The educated and with good jobs, have debt upon debt, and mommy and Daddy can’t help anymore. 6 Families in the inner Cities will do very well. I lived in them in Southie for years during such times. Above my Grandparent’s, and next door to the same set ups. Families living in 2 or 3 of the 6.
People get by in housing, and even during tough times usually by a friend that steps up. The issue clearly isn’t housing, but “Who” can only afford the cheapest, and “How” do the ones that can’t live? Homelessness should be unalloyed on the streets. If where your homeless are, they also feed the kids “For Free” in school, Then Feed The Homeless Too!! Damn Teachers Unions get plenty and have plenty, and could/should chip in perhaps?
Ex. Total Contributions: Between mid-2022 and mid-2024, the NEA and AFT collectively contributed over $43.5 million to various left-wing political action committees and advocacy groups.
What about the billions upon billions that the dying boomer generation is leaving to family/others Wont they buy homes, cars, travel trailers etc. etc. ? Thus bouncing the economy
– What about the billions upon billions that the dying boomer generation is leaving to family/others.
> I think you confuse “Trust Fund” Homes with “Boomer” Homes? Many Boomers never even owned a home. Many turn them over to existing family. Most Rent out, if they can, for additional income. No Funds for most, as 401K and Investment Funds didn’t really exist, except for the truly wealthy (not paper).
– Wont they buy homes, cars, travel trailers etc. etc.?
> They don’t want the used, older, needing repair vehicles, and will give them to kids in the family.
Guess before buying a house you should consider can ai take my job.
One could also look for a new job supporting AI.
Few years ago. Talking to a friend about ai. Yeah instead of 4 paralegals in an office. We were thinking it would go down to one or two. Speaking to relative a few weeks ago. His gf had a temp service placing paralegals with lawyers . Year ago she 10 or so busy full time. Now not a one. He said now younger more tech savvy lawyers are not hiring paralegals at all. They keep a small office meet with clients then go home and have ai do the leg work.
So in embracing ai might not work for everyone. Ai may end up like adding a million more people to the work force
And soon clients will go home and have AI do all the leg work the lawyer is getting AI to do.
In other words what are we paying the lawyer for if AI is doing all the work.
Legal and Accounting are 2 areas that AI is going to devastate.
A very predictable stalemate. They finally ran out of suckers willing (and able) to pay covidiot prices.
Once again, I’m confused. MAGA said once all the illegals that were buying up all the property with their stolen ultra low wage paying jobs were deported housing would be plentiful.
With all the deportations happening:
Why aren’t housing prices dropping?
Why aren’t housing sales increasing?
Why didn’t the weather slow down deportations but slow up real estate sales?
Where are the MAGA clowns claiming this would fix housing now?
Is the deportation job done? why is Holman running from Minnesota?
Do we need to just wait till next year?
Homan’s leaving before his agents murder any more Minnesotans.
– Once again, I’m confused. > Me too. I thought they were living in Hotel Rooms, mostly, in the inner Cities. They will just become trashed hotel rooms for rental once again.
– Why aren’t housing prices dropping? > Sellers can’t afford to?
– Why aren’t housing sales increasing? > Sellers can’t afford to?
– Why didn’t the weather slow down deportations but slow up real estate sales? > It Didn’t.
– Do we need to just wait till next year? Maybe 2-3 before they sell at a price people can afford, or they fall into disrepair and get torn down. Lots get sold perhaps? Houses won’t appear for quite some time however, as these are Investors. Land is always valuable to someone.
small quibble: from purhase agreement to closing is typically at least 30 days, more often 45-60 days. “That said, existing-home sales are recorded at closing, not purchase time. January sales mostly represent sales made in December.” Probably should say “made in November and December”
I had November or December initially.
That makes weather even less likely.
But what about all cash sales?
27% of transactions were cash sales.
That’s why I went with December alone – on average.
As modified …
I don’t recall anyone blaming good weather for the good December statistics.
Moreover, existing-home sales are recorded at closing, not purchase time.
Closings typically take 45-60 days.
Thus, January sales mostly represent contracts signed in November or December.
Cash sales may be quicker.
Then again, cash sales were only down a percentage point from 28 percent in December to 27 percent in January.
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I also added comments in an addendum