Home sales across the United States increased by 7 percent in July year-over-year, registering the strongest annual gain in 2026, according to real estate marketplace Zillow.
In total, 382,898 homes were sold last month, Zillow said in an Aug. 6 report. Among the metros tracked by the company, the largest annual sales gain was in Salt Lake City, Utah, where 19.9 percent more properties were sold in July than a year ago.
This was followed by Austin, Texas; Columbus, Ohio; Miami, Florida; and Milwaukee, Wisconsin—all of which recorded sales 15 percent higher than the previous year.
According to Zillow, the nationwide improvement in sales numbers last month was driven by home-buying contracts signed earlier, when purchase activity was driven by a combination of pent-up demand and an improving mortgage rate environment.
Moreover, housing costs in July were also lower on an annual basis. The monthly mortgage payment on a typical home last month, assuming a 20 percent down payment, was 0.9 percent lower than in the same month last year.
However, the affordability edge seen so far could disappear over the coming months, Zillow said, pointing to elevated mortgage rates.
The average weekly rate on a 30-year fixed-rate mortgage has remained above 6.4 percent every week since mid-May, according to Freddie Mac data.
This elevated rate dampens interest among prospective homebuyers. Since the week ending July 1, mortgage rates have risen for every week.
“Unless they reverse course, mortgage rates will be higher than last year in August, likely enough to push the typical mortgage payment above year-ago levels,” Zillow said.
“This portends a weaker half of the year for sales growth, with flat to declining transaction volumes for the remainder of the year in some regions.”
On the plus side, affordability for starter homes is improving faster than the overall housing market, according to an Aug. 5 report from real estate brokerage Redfin.
The income required to afford a typical starter home in June was down 1.5 percent from a year earlier. In fact, since November, the income needed to afford such a home has declined every month.
Moreover, a typical American household earns an estimated $87,599 annually, which is roughly $17,000 more than the median-priced starter home. The gap has increased compared to a year ago, when earnings were only $12,500 higher.
“Affordability is improving a bit faster for starter homes because their prices are increasing at a slower rate; the median price rose 1.2 percent year over year in June, compared with a 2.2 percent increase for all homes,” the report said.
Measures to Improve Affordability
On July 11, the 21st Century ROAD to Housing Act became law. The bill aims to improve housing affordability through a variety of measures, including rolling back permits and regulations, and offering financial support to builders, buyers, and state and local governments.
In a July 11 statement, the National Association of Realtors (NAR) welcomed the legislation becoming law after almost two years of advocacy.
Shannon McGahn, chief advocacy officer of NAR, said the law “combines nearly 50 carefully negotiated measures to increase housing supply, improve affordability, expand access to homeownership, strengthen housing finance, and support veterans.”
Secretary of Housing and Urban Development (HUD) Scott Turner highlighted in a July 31 X post that red tape was cited as a major challenge to building affordable homes whenever he traveled across the country.
The Trump administration is taking down “burdensome, duplicative regulations” and freeing up America’s housing supply, Turner said.
President Donald Trump
an executive order in March—Promoting Access to Mortgage Credit—to improve home ownership opportunities for Americans.
The order instructed officials from the Consumer Financial Protection Bureau to propose amendments to regulations that would restrict community banks, as well as other small financial institutions, from issuing mortgages.
Officials from the Federal Reserve, the Federal Deposit Insurance Corp., the National Credit Union Administration, and the Comptroller of the Currency were directed to ensure that mortgage lending evaluation was strictly based on merit.
In June, HUD
changes to its Federal Housing Administration (FHA) Single Family mortgage insurance program, eliminating outdated requirements and reducing administrative burdens. The updates are aimed at making FHA financing more efficient for lenders and buyers, the department said.
