Sales of existing single-family homes, condominiums and co-ops fell to 5.21 million at a seasonally adjusted annualized pace, the Realtors group said. The median home price rose 3.8% from a year ago to $259,400.
A dearth of supply is keeping home sales in check, said NAR Chief Economist Lawrence Yun. Measured as the number of months it would take to sell off the existing stock, there was a 3.9-month inventory of homes for sale in March. Economists consider a six-month supply to be a balanced market.
“Further increases in inventory are highly desirable to keep home prices in check,” Yun said in the report.
Properties stayed on the market an average of 36 days in March, down from 44 days in February. About 47% of homes stayed on the market for less than a month, according to the report.
First-time buyers comprised 33% of sales in March, up from 32% in February and 30% in March 2018.
Broken out by region, sales fell 2.9% in the Northeast and dropped 7.9% in the Midwest. In the South, sales decreased 3.4% and in the West sales fell 6%, according to the NAR report.
“The numbers that came out today make sense in terms of overall fundamentals in the housing market – it was the previous three months of numbers that were crazy,” said Joshua Shapiro, chief economist at consulting firm Maria Fiorini Ramirez in New York. “We had two months of overly weak numbers followed by February’s overly strong numbers.”
Some of the prior gyrations could have been caused by unexpected factors such as the government shutdown, Shapiro said. That might have caused January numbers to be weaker as some government-backed mortgages couldn’t get approved, followed by a “make up” in February, he said.
“By definition, when you have seasonally adjusted numbers, you are only adjusted for things that occur regularly,” Shapiro said.
Fannie Mae, the largest mortgage-finance company, forecasts U.S. home sales in 2019 will match last year’s 5.34 million, even with lower mortgage rates. For all of 2019, the rate for a 30-year fixed mortgage probably will average 4.2%, down from last year’s 4.5%, Fannie Mae said in its April forecast. Home prices probably will increase 4.6% this year, a slower pace than last year’s 5.7% gain, Fannie Mae said.
The average rate for a 30-year fixed mortgage was 4.17% last week, about a third of a percentage point below the 4.47 percent a year earlier, according to Freddie Mac. The rate probably will average 4.2% for the current quarter, rising to 4.4% by the end of the year, according to a Mortgage Bankers Association forecast.