The National Association of Realtors (NAR) said existing home sales grew for the second consecutive month in March, beating the median forecast. Still, low inventory levels weighed down sales activity on an annual basis.
Total existing-home sales — or, completed transactions that include single-family homes, town-homes, condominiums and co-ops — rose 1.1% to a seasonally adjusted annual rate of 5.60 million in March, up from 5.54 million in February. However, even with the increase, existing home sales are still 1.2% below a year ago.
“Robust gains last month in the Northeast and Midwest – a reversal from the weather-impacted declines seen in February – helped overall sales activity rise to its strongest pace since last November at 5.72 million,” Lawrence Yun, NAR chief economist said. “The unwelcoming news is that while the healthy economy is generating sustained interest in buying a home this spring, sales are lagging year ago levels because supply is woefully low and home prices keep climbing above what some would-be buyers can afford.”
The median existing-home price for all housing types in March came in at $250,400, up 5.8% from March 2017 ($236,600). That price increase marks the 73rd straight month of year-over-year gains.
“Although the strong job market and recent tax cuts are boosting the incomes of many households, speedy price growth is squeezing overall affordability in several markets – especially those out West,” Mr. Yun added.
Total housing inventory at the end of March gained 5.7% to 1.67 million existing homes available for sale. That is still down 7.2% from a year ago (1.80 million) and has fallen year-over-year for 34 consecutive months. Unsold inventory is at a 3.6-month supply at the current sales pace (3.8 months a year ago).
“Realtors throughout the country are seeing the seasonal ramp-up in buyer demand this spring but without the commensurate increase in new listings coming onto the market,” Mr. Yun added. “As a result, competition is swift and homes are going under contract in roughly a month, which is four days faster than last year and a remarkable 17 days faster than March 2016.”
Single-family home sales inched higher by 0.6% to a seasonally adjusted annual rate of 4.99 million in March, up from 4.96 million in February. However, they remain 1.0% below the 5.04 million sales pace a year ago. The median existing single-family home price was $252,100 in March, a 5.9% gain from March 2017.
Existing condominium and co-op sales rose 5.2% to a seasonally adjusted annual rate of 610,000 units in March. Yet, they are still 3.2% below a year ago. The median existing condo price was $236,100 in March, a 4.8% gain from a year ago.
Existing home sales in the Northeast shot up 6.3% to an annual rate of 680,000 in March, but are still 9.3% below a year ago. The median price in the Northeast was $270,600, or 3.3% higher than March 2017.
In the Midwest, existing home sales rose solidly 5.7% to an annual rate of 1.29 million in March and are now just 1.5% below a year ago. The median price in the Midwest was $192,200, up 5.1% from a year ago.
Existing home sales in the South fell 0.4% to an annual rate of 2.40 million in March, but are still 0.4% higher than a year ago. The median price in the South was $222,400, up 5.7% from a year ago.
In the West, existing home sales fell by 3.1% to an annual rate of 1.23 million in March, but are still 0.8% higher than a year ago. The median price in the West was $377,100, up 7.9% from March 2017.
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