Home Sales From Harlem To Hawaii Hit 3-Year High As Delayed Economic Data Shows Resilience

Delayed economic data released Wednesday painted a picture of resilient consumer spending and improving housing conditions in late 2025.

Even as federal agencies continue catching up after the longest government shutdown in U.S. history.

Existing home sales jumped 5.1% in December to a seasonally adjusted annual rate of 4.35 million units, the strongest pace in nearly three years, the National Association of Realtors reported. The gain exceeded economists’ expectations of 4.21 million units. Year-over-year, home sales rose 1.4%.

Housing Market Shows Signs of Recovery

“2025 was another tough year for homebuyers, marked by record-high home prices and historically low home sales,” said NAR Chief Economist Lawrence Yun. “However, in the fourth quarter, conditions began improving, with lower mortgage rates and slower home price growth.”​

The median existing home price in December was $405,400, up 0.4% from a year earlier, marking the 30th consecutive month of year-over-year price gains. Total housing inventory stood at 1.18 million units, down 18% from November but up 3.5% compared to December 2024.​

President Donald Trump last week ordered the Federal Housing Finance Agency to purchase $200 billion in bonds from Fannie Mae and Freddie Mac in an effort to lower mortgage rates. Analysts expect the purchases to have only a modest effect, as rates continue to track the benchmark 10-year Treasury yield.​

Consumer Spending Beats Expectations

Separately, the Commerce Department reported that retail sales rose 0.6% in November to $735.9 billion, rebounding from a revised 0.1% decline in October and exceeding expectations of a 0.4% increase. Sales at sporting goods and hobby stores led gains at 1.9%, while clothing retailers rose 0.9%.​

Both reports were delayed more than a month due to the 43-day federal shutdown that began on October 1 and ended on November 12, 2025. The closure disrupted data collection across statistical agencies, with some economic series now lagging by three months.​

The National Retail Federation predicts holiday retail sales for November and December will grow between 3.7% and 4.2% compared to 2024, potentially reaching $1 trillion for the first time.​

Inflation and Economic Outlook

The Labor Department also released delayed November producer price data, showing wholesale prices rose 0.2% from October and 3% year-over-year. Core producer prices, excluding food and energy, were flat month-over-month.​

Consumer spending continues to be driven disproportionately by higher-income households, with Bank of America Securities noting that the gap between higher- and lower-income spending “was substantial and persistent through the fourth quarter”.​

The Federal Reserve is widely expected to hold interest rates steady at its January 27-28 meeting, with the benchmark rate currently in the 3.5%-3.75% range. Inflation rose 2.7% in 2025, remaining above the Fed’s 2% target, writes Perplexity.