The National Association of Realtors (NAR) reports that the seasonally adjusted annual rate of existing home sales in December fell 2.5% to a seasonally adjusted annual rate of 5.49 million from an upwardly revised total of 5.65 million in November.

The consensus estimate called for sales to reach 5.538 million according to a survey of economists polled by Bloomberg. Total sales in 2016 came in at 5.45 million to surpass the total of 5.25 million last as the most sales since 2006 when 6.48 homes were sold.

The NAR’s chief economist, Lawrence Yun, said:

Solid job creation throughout 2016 and exceptionally low mortgage rates translated into a good year for the housing market. However, higher mortgage rates and home prices combined with record low inventory levels stunted sales in much of the country in December. While a lack of listings and fast rising home prices was a headwind all year, the surge in rates since early November ultimately caught some prospective buyers off guard and dimmed their appetite or ability to buy a home as 2016 came to an end.

Housing inventory decreased by 10.8% in December to 1.65 million homes, equal to a supply of just 3.6 months, the lowest since NAR began tracking the supply of housing in 1999. Inventory has declined year over year for 19 consecutive months and is currently down 6.3% year over year from 1.76 million in December 2015.

According to the NAR, the national median existing home price for all housing types in December was $232,300, up 4% compared with December 2015, the 58th consecutive month of rising home prices. In November the national median price was also $234,900.

The percentage of first-time buyers remained unchanged month over month at 32% in December, and was also the same as December 2015. Yun commented on the increase:

Constrained inventory in many areas and climbing rents, home prices and mortgage rates means it’s not getting any easier to be a first-time buyer. It’ll take more entry-level supply, continued job gains and even stronger wage growth for first-timers to make up a greater share of the market.

Sales of single-family homes fell 1.8% from the November total to a seasonally adjusted annual rate of 4.88 million, and is up 1.5% compared with December 2015. Sales of multi-family homes dropped 10.8% in November at a seasonally adjusted annual rate of 610,000 units.

All homes were on the market for an average of 52 days in December, up from 43 in November and down from 58 in December 2015. Foreclosed and non-distressed homes were on the market for an average of 53 and 50 days, respectively, and short sales took a median of 97 days to sell.

The NAR also reported the following regional data:

December existing-home sales in the Northeast dropped 6.% year-over-year to an annual rate of 760,000, up 2.7% compared with December 2015. The median price in the Northeast was $245,900, down 3.8% compared with last December.

In the Midwest, existing-home sales decreased by 3.8% to an annual rate of 1.28 million in December and are now 2.4% higher than December 2015 sales. The median price in the Midwest was $178,400, up 4.6% from a year ago.

Existing-home sales in the South remained unchanged in December an annual rate of 2.25 million, and are 0.4% higher than December 2015 sales. The median price in the South was $207,600, up 6.5% from a year ago.

Existing-home sales in the West dropped 4.8% to an annual rate of 1.2 million in December, and have moved 1.6% below December 2015 totals. The median price in the West was $341,000, up 6% compared with the December 2015 median.

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