Existing-home sales were at a seasonally adjusted annual rate of 4.02 million in March, a decrease of 5.9% compared with February, according to the National Association of Realtors (NAR).
Year-over-year, existing-home sales fell 2.4%.
Driving the decrease were higher mortgage rates and market volatility caused by the tariffs.
Higher home prices also played a role: The median existing-home sales price climbed 2.7% from March 2024 to $403,700, an all-time high for the month of March and the 21st consecutive month of year-over-year price increases.
The inventory of unsold existing homes jumped 8.1% from the previous month to 1.33 million – about a 4.0-month supply at the current sales pace. Year-over-year, inventory of existing homes is up 19.8%.
“Home buying and selling remained sluggish in March due to the affordability challenges associated with high mortgage rates,” says Lawrence Yun, chief economist for NAR, in a statement. “Residential housing mobility, currently at historical lows, signals the troublesome possibility of less economic mobility for society.”
NAR includes sales of townhomes, condominiums and co-ops in with its results.
Regionally, and month-over-month, existing-home sales were down 2.0% in the Northeast, 5.0% in the Midwest, 5.7% in the South, and 9.4% in the West.
“In a stark contrast to the stock and bond markets, household wealth in residential real estate continues to reach new heights,” Yun says. “With mortgage delinquencies at near-historical lows, the housing market is on solid footing. A small deceleration in home price gains, which was slightly below wage-growth increases in March, would be a welcome improvement for affordability. With real estate asset valuation at $52 trillion, according to the Federal Reserve Flow of Funds, each percentage point gain in home prices adds more than $500 billion to the household balance sheet.”
Cash sales accounted for 26% of transactions in March, down from 32% in February and 28% in March 2024.
Individual investors or second-home buyers, who make up many cash sales, purchased 15% of homes in March, down from 16% in February and unchanged from March 2024.
Distressed sales – foreclosures and short sales – represented 3% of sales in March, unchanged from February and up from 2% the prior year.
Photo: Scott Webb