Fewer Homes Are Selling. Why Aren’t Home Prices Falling?

The latest housing numbers present what initially looks like a contradiction.

Redfin reported on August 12 that U.S. home sales fell 4.1% from June to July, reaching their lowest seasonally adjusted level in nearly two years.

Yet the median U.S. home-sale price didn’t fall with them. It increased 3.2% compared with a year earlier, reaching $407,730.

So how can fewer homes be selling while prices remain relatively strong?

The simplest answer is that sales activity and home values measure two different things.

Fewer Sales Don’t Automatically Mean Lower Prices

A decline in completed sales tells us something about the number of buyers and sellers successfully coming together on a transaction.

It doesn’t necessarily tell us what those homes are worth.

Today’s market continues to deal with several unusual forces. Affordability remains challenging for many buyers. Mortgage rates affect purchasing power. At the same time, some homeowners with attractive existing mortgage rates have little incentive to sell unless they have a compelling reason to move.

Put those factors together and you can have fewer transactions without enough downward pressure to produce dramatically lower prices.

The Northwest Makes the Story More Interesting

Redfin specifically identified Seattle as one of the markets contributing to July’s decline in sales.

It’s tempting to take a headline about Seattle and assume it tells us something about the entire Pacific Northwest.

That’s where I think we need to be careful.

Housing markets are remarkably local.

Redfin’s Spokane data, for example, showed the city’s median sale price essentially flat year over year in its latest available three-month reporting period, while the number of homes sold was slightly higher.

Those aren’t dramatic numbers, and that’s precisely the point.

The Spokane market doesn’t have to follow Seattle, just as Spokane Valley doesn’t necessarily follow Spokane and Coeur d’Alene doesn’t necessarily follow either one.

There Really Isn’t One “Housing Market”

We frequently talk about “the housing market” as though millions of homes across the country are all participating in one enormous marketplace.

For practical purposes, they aren’t.

A $350,000 home in Spokane Valley may face a very different pool of buyers than an $850,000 home in North Spokane. Move across the state line into North Idaho and the competitive landscape changes again.

Even within the same neighborhood, condition, updates, lot characteristics and pricing strategy can substantially change the response to two otherwise similar homes.

That’s why national data is useful for understanding direction, but local comparable sales are generally much more useful when making an actual real estate decision.

What Should Buyers and Sellers Watch?

For sellers, slower national sales shouldn’t automatically be interpreted as a signal that values are collapsing. It does, however, make accurate pricing and presentation increasingly important when buyers have more choices.

For buyers, slower activity can create opportunities for a little more patience and negotiation, but desirable homes that are priced correctly can still attract competition.

The question I’d ask isn’t simply:

“What is the housing market doing?”

I’d make it considerably more specific:

“What is the market doing for this particular home, in this particular location, at this particular price?”

That’s usually where a national headline stops and useful real estate analysis begins.

Source: Redfin, Home Sales Drop to Lowest Level in Nearly 2 Years, August 12, 2026.

https://www.redfin.com/news/pending-sales-decline-july-2026/

Fewer home sales don’t necessarily mean falling home prices. Local market conditions matter.