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Existing home sales in the US have fallen more than expected in March, overwhelmed by increased borrowing costs, and the weakness is likely to be growing concerns about a slower economy as SAP demand.
The National Association of Realtors said Thursday that home sales fell to a seasonally adjusted annual rate of 42 million units, down 5.9% last month. The economists voted by Reuters had reduced home resale to a percentage of 4.13 million units.
This was a 2.4% decrease from the previous year in March.
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Home sales fell 5.9% last month to a seasonally adjusted annual rate of 4.2 million units. (via Steve Pfost / Newsday RM Getty Images / Getty Images)
Existing home sales will be counted at the end of the contract. Sales last month may reflect contracts signed in January and February, when the average interest rate on the popular 30-year fixed mortgage was hovered at nearly 7%. It then rose to two months’ highs last week after the rate eased in March.
The dim economic outlook can be seen dragging the housing market in the wake of President Donald Trump’s ever-changing tariff policies and the uncertainty caused by the obligations already imposed on numerous imports, including timber.
Government data on Wednesday showed median prices fell as new home sales surged to six-month highs in March, providing incentives for builders to reduce inventory.
“We’ve seen a lot of effort into making this a reality,” said Lawrence Yun, chief economist at NAR.
The dim economic outlook can be seen dragging the housing market in the wake of President Donald Trump’s ever-changing tariff policies and the uncertainty caused by the obligations already imposed on numerous imports, including timber. (Getty Images/Getty Images)
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Inventories in existing homes jumped from 8.1% to 1.33 million units in March. Supply rose 19.8% from a year ago. Median existing home prices rose 2.7% from the previous year to $403,700 in March.
At the sales pace in March, it would take 4.0 months to release current inventory of existing homes from 3.2 months before the year before. Supply for 4-7 months is considered a healthy balance between supply and demand.
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Real estate typically stayed in the market for 36 days last month compared to 33 days ago the previous year.
First-time buyers accounted for 32% of sales, as they did a year ago. Economists and real estate agents say the robust housing market needs a 40% share. All-Cash sales account for 26% of transactions, starting from 28% a year ago.
Suffering sales, including foreclosures, accounted for 3% of transactions, up from 2% a year ago.
