Home sales across the United States rose 7 percent in July compared with the same month a year earlier, the strongest annual gain of 2026 so far, according to data from real estate marketplace Zillow released on Aug. 6.
Zillow counted 382,898 homes sold nationally in July, reflecting a pickup driven largely by purchase activity that began earlier in the year when demand that had been building on the sidelines combined with a somewhat better mortgage rate environment to bring more buyers into the market.
The year-over-year improvement was broad-based across major metropolitan areas, with several cities reporting particularly large gains. Salt Lake City led all tracked metros with a 19.9 percent increase in sales compared with a year ago. Austin, Columbus, Miami and Milwaukee each posted gains of approximately 15 percent or more.
What drove the July numbers
Zillow attributed the July sales increase primarily to contracts that were signed in earlier months, when conditions were more favorable for buyers. That lag between contract signing and closing means that the sales data reported in any given month reflects decisions made weeks or even months prior.
Purchase activity earlier in the year was lifted by two factors that were both present in the spring window. The first was pent-up demand, representing buyers who had delayed purchases through the higher-rate environment of the prior two years and eventually decided to re-enter the market. The second was some improvement in mortgage rates from the peaks reached in 2023 and 2024, which modestly reduced the monthly mortgage burden for new buyers.
The monthly mortgage payment on a typical home in July, assuming a 20 percent down payment, was 0.9 percent lower than a year earlier. That small reduction in mortgage costs contributed to the better conditions that drove the spring contracts now showing up as July closings.
The risk of rising rates ahead
Zillow warned that the affordability improvement visible in the July data may not persist. Mortgage rates have remained elevated by historical standards will significantly affect how many contracts are signed in the near term and therefore how many closings appear in future sales reports.
If rates rise or remain high through the fall, the pent-up demand that supported spring activity will be more difficult to sustain. The buyers who moved off the sidelines during the spring window are no longer waiting, and if the rate environment discourages a new cohort of buyers from entering, the sales gains reported in July may not carry through to the back half of the year.
Why housing activity matters
Home sales are one of the more closely watched indicators of economic activity for several reasons. Each transaction generates ancillary economic activity across services including inspection, legal, mortgage and financial, as well as spending on furniture, appliances and home improvements. A sustained recovery in home sales would have meaningful downstream effects on the economy beyond the real estate sector itself.
The 7 percent annual gain in July comes from a relatively depressed baseline, as home sales nationally have been running below historical averages for the better part of two years as affordability constraints squeezed buyers out of the market. A single strong month does not necessarily indicate a sustained recovery, but the breadth of the gains across major metros suggests the improvement in July was not narrowly concentrated in a few markets.
Salt Lake City’s 19.9 percent gain and the strong numbers in Austin and Miami in particular reflect markets that had seen significant price appreciation in prior years and then sharp corrections in activity, making year-over-year comparisons more likely to show large gains as those markets stabilize.
