Sales of existing homes slipped 2.7% in March, though prices continued their upward rise, the National Association of Realtors reported on Wednesday.The March number follows a decline of 7.2% in February and comes as new home permits and starts both beat expectations in March, rising modestly.
The median price of a home sold reached $375,300, 15% higher than a year ago. “The housing market is starting to feel the impact of sharply rising mortgage rates and higher inflation taking a hit on purchasing power,” said Lawrence Yun, NAR’s chief economist. “Still, homes are selling rapidly, and home price gains remain in the double-digits.”
Yun predicts rising mortgage rates will slow the pace of home contracts by 10% this year. Sales are being limited by a low inventory of available homes, rising prices and, now, mortgage rates that have soared as the Federal Reserve raises interest rates to thwart inflation. The average rate for a 30-year, fixed-rate loan is now above 5%.
“Recent weekly housing data suggests that we may start to see a turn-around in availability, with the most recent two weeks of data showing year over year increases in the number of fresh-listings, a bit of good news for buyers as we are in what is typically the best time of year to list a home for sale,” Danielle Hale, chief economist for Realtor. com, said in advance of the report’s release.
