April Home Sales Miss Forecasts as Mortgage Rates and Iran War Uncertainty Bite

CNBC reported Monday that April home sales came in far below expectations. Elevated mortgage rates and anxiety over the ongoing US-Israel conflict with Iran weighed heavily on buyer activity last month.

Sales Barely Move as Analysts Expected More

Existing home sales inched up just 0.2% in April from March. That left the seasonally adjusted annualized pace at 4.02 million units, according to the National Association of Realtors. Analysts had penciled in a gain exceeding 3%. Sales were also flat compared with April a year earlier. Because this data tracks closings, it largely reflects contracts signed in late February and March.

NAR chief economist Lawrence Yun acknowledged contradictory signals in the broader economy. He noted that rising stock markets and improving affordability offered some support to buyers. Still, consumer confidence has remained historically depressed. Yun pointed out that mortgage rates are below year-ago levels and that wage growth is outpacing home price appreciation.

Also Read: Fed Holds Rates Steady Amid Trade and Geopolitical Uncertainty

Mortgage Rate Spike Was the Culprit

The average 30-year fixed mortgage rate closed out March in the high 5% range. It then climbed sharply in April after the US and Israel launched military operations against Iran. As of this week, the benchmark rate sits at 6.42%, representing a meaningful affordability blow for prospective buyers.

A Market Stuck in Tight Supply

Inventory rose nearly 6% month over month in April but climbed only 1.4% against the prior year. That translates to a 4.4-month supply, still well short of the six-month level that signals a balanced market. Yun said inventory needs to grow by roughly 30% to meaningfully ease conditions.

Also Read: US Consumer Sentiment Slumps to Multi-Year Low

Prices Hit a Record High for April

Despite sluggish sales volume, competition kept prices elevated. The median sale price reached $417,700, up 0.9% year over year and the highest April figure NAR has ever recorded. Homes averaged 32 days on the market, three days longer than April 2025. Multiple-offer situations persist, though they are less frequent than in previous years. First-time buyers accounted for 33% of transactions, a slight annual decline. Cash deals held steady at one-quarter of all sales. With pending sales showing modest improvement and supply tightening again heading into summer, further price pressure appears likely in the months ahead.

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