Lack of inventory, high home prices and rising mortgage rates slowed existing-homes sales in April.
According to the National Association of Realtors (NAR), existing-home sales fell 1.9% compared with March to a seasonally adjusted annual rate of 4.14 million.
Year-over-year, existing-home sales were down 1.9%.
Despite a 9% month-over-month increase in inventory in April, home prices continued to increase: The median existing-home price jumped 5.7% year-over-year in April to $407,600.
It was the tenth consecutive month of year-over-year price gains.
The inventory of unsold existing homes increased to 1.21 million, as of the end of April. That’s about a 3.5-month supply at the current monthly sales pace.
Regionally, all four major U.S. regions posted month-over-month declines. Year-over-year, sales decreased in the Northeast, Midwest and South but increased in the West.
“Home sales changed little overall, but the upper-end market is experiencing a sizable gain due to more supply coming onto the market,” says Lawrence Yun, chief economist for NAR, in a statement.
For homes priced $1 million or more, inventory and sales increased by 34% and 40%, respectively, from a year ago, NAR says.
In a statement, Selma Hepp, chief economist for CoreLogic, says “The housing market continues to unthaw slowly amid considerable affordability challenges brought on by high interest rates and rising homeownership expenses. Lower mortgage rates later this year will provide a breather, though the average potential homebuyer continues to maintain a wait-and-see approach.
“Improvements in existing for-sale inventory are critical and will help thaw out sales further,” Hepp adds.
In a separate statement, Max Slyusarchuk, founder and CEO of A&D Mortgage, says the “numbers are disappointing and it’s difficult to feel positive about housing for 2025 overall. Active home listings are up by more than 30 percent, from a year ago, so that’s a step in the right direction.
However, homebuyers are waiting on the sidelines for rates to lower, and the Fed signaled that this won’t happen until September, which is putting a damper on potential home sales.”
Photo: Ian MacDonald