Sales of previously occupied U.S. homes fell in 2024 to a nearly 30-year low for the second time in as many years as elevated mortgage rates, rising home prices and few properties on the market freeze prospective homebuyers out of the market.

The National Association of Realtors said Friday that existing U.S. home sales totaled 4.06 million last year, a 0.7% decline from 2023. That is the weakest year for home sales since 1995, echoing the full-year results from 2023.

The median national home price for all of last year rose 4.7% to an all-time high $407,500, the NAR said.

The U.S. housing market has been in a sales slump dating back to 2022, when mortgage rates began to climb from pandemic-era lows. The average rate on a 30-year mortgage surged to a 23-year high of nearly 8% in October 2023 and briefly fell to a 2-year low last September, but has been mostly hovering around 7%, according to mortgage buyer Freddie Mac.

The elevated home loan borrowing costs have limited home hunters’ buying power on top of years of soaring prices. A dearth of homes for sale, meanwhile, has helped prop up prices, helping to keep many homebuyers and sellers on the sidelines.

“How is it possible that home sales can be this low, considering that the U.S. population has increased by more than 70 million over this time period from 1995 to today?” asked Lawrence Yun, the NAR’s chief economist. “One can partly answer that question because of the affordability issue. ”Record-high home prices, mortgage rates having risen, but also lack of inventory."

At the end of December, there were just 1.15 million homes on the market, NAR said. That's well below the monthly historical average of about 2.25 million.

The available inventory at the end of last month amounts to a 3.3-month supply, going by the current sales pace. In a more balanced market between buyers and sellers, there is a 4- to 6-month supply.

Home sales in December rose 2.2% from the previous month on a seasonally adjusted basis to a 4.24 million annual pace. That's the third straight monthly increase in sales and tops the 4.2 million pace forecast by analysts polled by FactSet.

Sales rose 9.3% in December versus the same month last year.

The median home sales price rose for the 18th consecutive month in December to $404,000, up 6% from a year earlier.

Limited inventory, especially in the more affordable price range of a given market, helps drive prices higher. That’s one reason many first-time homebuyers, who don’t have any home equity to put toward their down payment, continue to struggle to afford a home.

They accounted for 31% of all homes sold last month, up from 30% in November and 29% in December 2023. However, the annual share of first-time buyers was 24%. It's been 40% historically.