August 2026 Existing-Home Sales: Inventory Tops 1.6 Million for First Time Since 2019 — 4.9 Months' Supply Highest in a Decade, Cancellations at Five-Year High
NAR's August 2026 existing-home sales report (released September 10, 2026) confirms the resale market is freezing under 7% mortgage rates while supply keeps accumulating — the mirror image of the new-home market, where builders are clearing inventory with price cuts and buydowns (see New Homes Now Cheaper Per Square Foot Than Existing in a Third of Major Markets — Zillow Quantifies the Builder-Discount Economy).
The hard numbers (from the NAR release):
- Sales: 3.98 million SAAR, down 2.0% MoM and 1.2% YoY — "The last time sales activity fell below 4.0 million was in June 2025."
- Inventory: 1.62 million units, up 3.2% MoM and 5.9% YoY — "the first time since November 2019 that inventory exceeded 1.6 million units."
- Months' supply: 4.9 months, up from 4.6 in July and 4.6 a year ago — "its highest level in over ten years."
- Median price: $429,100, +1.6% YoY — "the 38th consecutive month of year-over-year price increases."1
- Housing Affordability Index: 104.7, up from 101.2 a year ago.
NAR chief economist Lawrence Yun: "The number of months it would take to exhaust the total inventory at the current sales pace has grown to 4.9 months' supply—its highest level in over ten years. The ample supply of homes for sale on the market is giving homebuyers better opportunities to negotiate." Yun still framed demand as wage-supported: "home prices are rising, and existing home sales are actually up 1.6% year-to-date through the first eight months of the year... Job creation and wage growth typically drive housing demand."
The demand crack — cancellations: A September 24 Cotality report found canceled home-sale contracts hit a five-year high in August, with nearly 12% of June contracts failing to close within 60 days. "Rising mortgage rates have pushed buyers without rate locks beyond their affordability boundaries," the report said, adding that cancellations "likely accounted for at least a third of August's closed sales declines" and that "rising rates may lead to elevated cancellations through autumn." Mortgage purchase applications were running 11% below a year ago (MBA, week ending Sept 18), with refi volume at its slowest since February 2025.
Regional texture: sales fell MoM in the Northeast (-4.0%), Midwest (-3.1%) and South (-1.6%), flat in the West; the West was the only region with YoY price declines (median $619,100, -0.2%), while the South — the builders' biggest footprint — held flat YoY on volume (1.84M SAAR). First-time buyers were 30% of sales; cash deals 27%.
Watch the divergence this sets up: rising resale inventory + falling new-home prices + 4.9 months' resale supply is classic buyer's-market plumbing, yet transaction volumes keep sinking because the marginal buyer can't clear 7% financing. The Q3 builder earnings cycle (NVR Oct 22, DHI late Oct, TOL Dec 8) will show how much of this shows up in builder cancellation rates.
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An instance of Housing liquidity recovers only when sellers cut listing prices and builders halt new starts. — With sellers still raising prices into a decade-high 4.9 months' supply, transactions stay frozen exactly as the law predicts — no seller price cuts, no liquidity. ↩︎