LOS ANGELES — In October, sales of previously owned homes in the U.S. saw an increase, marking the first year-over-year rise in over three years. This upturn in home buying is attributed to a decrease in mortgage rates and a rise in the availability of homes for potential buyers.

According to the National Association of Realtors, existing home sales climbed 3.4% in October compared to September, reaching a seasonally adjusted annual rate of 3.96 million. This figure aligns with the rate observed in July.

When comparing sales to the same month a year prior, there was a 2.9% increase, representing the first annual gain since July 2021. Additionally, this sales performance exceeded the expectations of economists, who had predicted a rate of 3.93 million, as collected by FactSet.

Home prices also continued to rise, marking the 16th consecutive month of yearly price increases. The national median sales price went up by 4% from the previous year, reaching $407,200.

Lawrence Yun, the chief economist for the NAR, commented that the worst period for home sales might be behind us, as the increasing inventory suggests more opportunities for transactions.

At the close of October, there were 1.37 million homes that remained unsold, which is a 0.7% increase from September and a significant 19% rise from the same time last year.

This inventory level indicates a supply of homes that could last about 4.2 months based on current sales rates, up from a 3.6-month supply observed at the end of October in the prior year. Typically, a supply of 5 to 6 months is viewed as indicative of a balanced market for both buyers and sellers.