Existing-home sales fall 2.4% in March
Existing-home sales declined in March, the National Association of Realtors (NAR) reported this morning.
Total existing-home sales, including completed transactions of single-family homes, townhomes, condominiums, and co-ops fell 2.4% from February to a seasonally adjusted annual rate of 4.44 million in March.
Year-over-year, sales tumbled 22% from a rate of 5.69 million in March 2022.
Single-family home sales declined 2.7% to a seasonally adjusted annual rate of 3.99 million in March from 4.10 million in February and 21.1% from one year ago.
The median existing single-family home price was $380,000 in March, down 1.4% from March 2022.
Existing condominium and co-op sales hit a seasonally adjusted annual rate of 450,000 units in March, which is identical to February but down 28.6% from the previous year, the NAR said.
The median existing condo price was $337,300 in March, an annual increase of 2.1%.
“Home sales are trying to recover and are highly sensitive to changes in mortgage rates,” said NAR Chief Economist Lawrence Yun. “Yet, at the same time, multiple offers on starter homes are quite common, implying more supply is needed to fully satisfy demand. It’s a unique housing market.”
Total housing inventory registered at the end of March was 980,000 units, up 1% from February and 5.4% from one year ago (930,000). But unsold inventory sits at just 2.6-month supply at the current sales pace, unchanged from February but up from 2.0 months in March 2022.
Following the release of the latest National Association of Home Builders/Wells Fargo Housing Market Index, the NAHB pointed to the lack of housing supply as a catalyst for home buyers to look to new home purchases. NAHB Chief Economist Robert Dietz said one-third of current housing inventory is new construction, compared to historical norms of a little more than 10%.
The median existing-home price for all housing types in March was $375,700, a decline of 0.9% from March 2022 ($379,300). Prices climbed slightly in three regions but dropped in the West, the NAR said.
“Home prices continue to rise in regions where jobs are being added and housing is relatively affordable,” Yun noted. “However, the more expensive areas of the country are adjusting to lower prices.”
Released earlier this week, the latest HomeSphere/BTIG Builder Survey revealed that 21% of builders reported raising either some, most or all base prices in March (vs. 27% last month), while 22% of builders lowered most, all or some base prices (vs. 30% last month).
According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.27% as of April 13, down from 6.28% from the previous week but up from 5% one year ago.
“With overall consumer price inflation calming and rents expected to decelerate from robust apartment construction, the Federal Reserve’s monetary policy will surely shift from tightening to neutral to possibly loosening over the next 12 months,” Yun added. “Therefore, home sales will steadily rebound despite several months of fluctuations.”
Here’s how existing-home sales break down on a regional basis:
- Existing-home sales in the Northeast were flat compared to February at an annual rate of 520,000 in March, but down 21.2% from March 2022. The median price in the Northeast was $395,400, up 1% from one year ago.
- In the Midwest, existing-home sales declined 5.5% from one month ago to an annual rate of 1.03 million in March, falling 17.6% from the previous year. The median price in the Midwest was $273,400, up 1.7% from March 2022.
- Existing-home sales in the South slipped 1% in March from February to an annual rate of 2.07 million, a 20.4% decrease from the prior year. The median price in the South was $347,600, an increase of 0.3% from one year ago.
- In the West, existing-home sales decreased 3.5% from the previous month to an annual rate of 820,000 in March, down 30.5% from the prior year. The median price in the West was $565,400, down 7.5% from March 2022.
