03:18 PM EDT, 08/12/2026 (MT Newswires) -- US home sales in July hit the lowest level in almost two years amid near-record prices, high mortgage rates and economic instability, Redfin.com said Wednesday.

Sales fell 4.1% sequentially to 285,312 units last month on a seasonally adjusted basis, while the median sale price rose 3.2% year over year to a July record of $407,730, according to the online real estate brokerage. The monthly average mortgage rate surged to a one-year high of 6.54%.

"The housing market suffered from a mid-summer slump in July as would-be buyers grappled with record-high home prices, increasing mortgage rates and growing financial insecurity," said Chen Zhao, Redfin's head of economics research.

Among major US metros, homebuying demand dropped most sharply in Texas and Seattle, while West Palm Beach, Florida, saw sales grow at the fastest rate.

Pending home sales dropped 2.5% sequentially in July to their lowest level since December 2025, while new listings reached their lowest reading since October 2024, according to the report.

"Many Americans simply can't afford today's housing costs, while others are holding off because they're worried about the economy and/or their job security," Zhao said. "The silver lining is that the buyers who can afford a home may be able to negotiate on price and get concessions from sellers who are eager to offload their house."

Separately, the Mortgage Bankers Association said Wednesday that mortgage applications in the US increased 3.6% sequentially last week as rates mostly fell. The average fixed rate for 30-year mortgages with conforming loan balances of $832,750 or less dropped to 6.77% from 6.81%.

"After five consecutive weeks of increases, mortgage rates declined slightly last week as oil prices dipped briefly on the hopes of a sustained resolution to the war in Iran," MBA Deputy Chief Economist Joel Kan said.

On Tuesday, National Association of Realtors data showed that existing home sales in the US fell more than expected last month as rising prices and mortgage rates continued to weigh on homebuying activity.