U.S. existing-home sales rise modestly in July as supply improves

U.S. existing-home sales rose modestly in July as a softer mortgage-rate environment coincided with a pickup in available homes, marking the latest sign that real estate conditions are gradually stabilizing after years of high prices and high borrowing costs. Buyers bought at a seasonally adjusted annual rate of 4.01 million homes, a 2% increase from June, with activity also trimming the drop from a year earlier to 0.8%. The year-over-year gain came as economists had anticipated a pace near 3.92 million, underscoring a trajectory of incremental improvement rather than a rapid rebound.

Prices continued to rise but at a slower pace, with the national median sale price up 0.2% from a year earlier to 422,400. This marked the 25th straight month of price increases, though the rate of growth remained tepid compared with prior years. The year-over-year price momentum has cooled as affordability pressures persist, yet the July reading also reflected a historic level for July, signaling that buyers are still navigating a market where demand is tempered by higher borrowing costs.

Mortgage rates played a role in the July dynamics, easing enough to encourage more contract activity for some...