April Home Sales Miss Forecasts as Mortgage Rates Climb

CNBC reported Monday that April home sales came in well below expectations, as a sharp spike in mortgage rates and consumer anxiety over the US-Israel conflict with Iran kept buyers on the sidelines.

Sales Fall Far Short of Forecasts

Sales of previously owned homes climbed a mere 0.2% in April from the prior month. That placed the annualized rate at 4.02 million units on a seasonally adjusted basis, according to the National Association of Realtors. Analysts had forecast a gain of more than 3%. Year-over-year, sales were entirely flat. Because the data tracks closings rather than new signings, it reflects contracts likely agreed in late February and March.

NAR chief economist Lawrence Yun noted a paradox in current conditions. He pointed to record equity markets sitting alongside historically weak consumer sentiment. Yun added that mortgage rates remain lower than a year ago and that wage growth is outpacing home price appreciation. Even so, the April numbers told a cautious story.

Also Read: Fed Holds Rates Steady Amid Inflation and Growth Uncertainty

What Drove the Mortgage Rate Surge

The average 30-year fixed mortgage rate closed out March in the upper 5% range, according to Mortgage News Daily. It then climbed sharply as the US and Israel launched military operations against Iran. That shock to consumer confidence translated directly into buyer hesitation during the closing window captured in April’s figures. As of this week, the benchmark rate sits at 6.42%.

A Market With Thin Supply and Rising Prices

Housing inventory has been a persistent drag on affordability. April inventory rose nearly 6% from March but was up less than 2% compared with April 2025. The current 4.4-month supply remains well short of the 6-month level that signals a balanced market between buyers and sellers. Yun said the market needs roughly 30% more inventory before conditions normalize meaningfully. Multiple-offer situations persist, even if less frenzied than in prior years. Homes are also taking longer to sell, averaging 32 days on market versus 29 days a year ago. That extended timeline points to buyers moving deliberately rather than rushing decisions. Despite soft volume, the median sale price for April reached $417,700, a 0.9% year-over-year gain. That marks the highest April median price on NAR record. First-time buyers accounted for 33% of transactions, a slight dip from the previous year. All-cash deals held steady at 25% of total sales.

Looking ahead, pending sales data for April and May point to some recovery in deal flow. However, supply appears to be tightening again, which analysts expect will keep upward pressure on prices through the summer.

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