A "For Sale" sign outside a home in Crockett, California, US, on Thursday, Sept. 3, 2026.

Homebuyers continue to struggle amid higher mortgage rates and lofty home prices.

Sales of previously owned homes fell 2% in August from July to 3.98 million units on a seasonally adjusted, annualized basis, according to the National Association of Realtors. The sales activity marked the slowest pace since June 2025 and was felt hardest in the Northeast and Midwest.

Sales were down 1.2% year over year.

This count is based on closings, so contracts likely signed in June and July, when mortgage rates were higher than they were in the spring. Rates moved sharply higher in the middle of July.

"Mortgage rates and home sales move in opposite directions, so it's not surprising to see a mild dip in home buying activity due to high mortgage rates," said Lawrence Yun, chief economist for the Realtors. "Still, home prices are rising, and existing home sales are actually up 1.6% year-to-date through the first eight months of the year."

Housing supply totaled 1.62 million homes for sale at the end of August, up 3.2% from July and up 5.9% from the year before. At the current sales pace, that represents a 4.9-month supply — the highest level in more than a decade, according to NAR.

Despite more supply, prices continue to rise. The median price of a home sold in August was $429,100, up 1.6% from August 2025. That is a new high for the month of August.

Price gains were strongest in the Northeast, where inventory is lowest. The West was the only region to see a median price decline year over year.