Rising prices and mortgage rates caused the sale of second-hand homes to plummet by 4.3% in March compared to February's data, the first decline recorded since December 2023. In addition, transactions of these properties also dropped by 3.7% in compared to March of last year.
As reported in a statement by the National Association of Realtors (NAR), sales were down in all regions of the United States, except the Northeast, where transactions increases for the first time since November 2023 (4.2%).
Existing-home sales slipped in March. Among the four major U.S. regions, sales slid in the Midwest, South and West, but rose in the Northeast for the first time since November 2023. Year-over-year, sales decreased in all regions. https://t.co/f1nOHxTEnv
— National Association of REALTORS® (@nardotrealtor) April 18, 2024
The two main reasons for the decline in existing home sales in March were mortgage rates and prices. Lawrence Yun, the association's chief economist, said rates are hampering business in the secondhand housing market:
Though rebounding from cyclical lows, home sales are stuck because interest rates have not made any major moves. There are nearly six million more jobs now compared to pre-COVID highs, which suggests more aspiring home buyers exist in the market.
The median price in March was $393,500, up 4.8% from the same month last year. This is the ninth consecutive month that the median price has increased.
A positive aspect of March in the real estate market was the increase in the percentage of first-time homebuyers. Yun said:
Good to see that number go up above 30%. People heard about the lawsuit settlement where the buyers possibly need to come up with extra funds to pay up some professional representation, but they want to do it before the new rules takes place sometime in July.
