Sales of existing homes roared back
in March after suffering an unexpected setback in February. The National Association of Realtors® (NAR)
said sales of existing single-family houses, townhouses, condominiums, and
cooperative apartments were at a seasonally adjusted annual rate of 5.71
million, an increase of 4.4 percent from the downwardly adjusted February
number of 5.47 million (from 5.48 million).
results were toward the high end of analysts' estimates. Those polled by Econoday were looking for
sales in the range of 5.49 to 5.80 million units with a consensus of 5.61
The pace of sales was up 5.9 percent
from that of last March and surpasses this past January to become the best
month for sales since February 2007.
Sales then were at the rate of 5.79 million units.
Sales of single-family homes rose
4.3 percent to a seasonally adjusted annual rate of 5.08 million from 4.87 in
February, putting those sales 6.1 percent higher than during the same month in
2016. Condo sales were also up, rising
5.0 percent to a seasonally adjusted annual rate of 630,000 units, a 5.0
percent annual gain.
Lawrence Yun, NAR chief economist,
says the strong sales during the month were led by hefty gains in the Northeast
and Midwest. "The early returns so far this spring buying season look very
promising as a rising number of households dipped their toes into the market
and were successfully able to close on a home last month," he said.
"Although finding available properties to buy continues to be a strenuous
task for many buyers, there was enough of a monthly increase in listings in
March for sales to muster a strong gain. Sales will go up as long as inventory
The median existing-home price for
all housing types in March was $236,400, up 6.8 percent from the March 2016 median
of $221,400. March's price increase marks the 61st consecutive month
of year-over-year gains. The median existing single-family home price was
$237,800 in March, up 6.6 percent on an annual basis and the median condo price
was up 8.0 percent to $224,700.
Yun continued, "Bolstered by
strong consumer confidence and underlying demand, home sales are up
convincingly from a year ago nationally and in all four major regions despite
the fact that buying a home has gotten more expensive over the past year."
There was some expansion of housing
inventory from February. Total available
existing homes for sale rose 5.8 percent to 1.83 million units but that was
still down 6.6 percent from the March 2016 level. Available listings represented a 3.8-month
supply at the current rate of sales, unchanged from February. Inventory has fallen year-over-year for 22
NAR said the tight inventories led
to shortened marketing time. Properties
typically stayed on the market for 34 days in March, which is down
significantly from 45 days in February and 47 days a year ago. Short sales were
on the market the longest at a median of 90 days, while foreclosures sold in 52
days and non-distressed homes took 32 days, the shortest since NAR began
tracking them in May 2011. Forty-eight percent of homes sold in March were on
the market for less than a month.
"Last month's swift price gains
and the remarkably short time a home was on the market are directly the result
of the homebuilding industry's struggle to meet the dire need for more new
homes," said Yun. "A growing pool of all types of buyers is competing
for the lackluster amount of existing homes on the market. Until we see significant
and sustained multi-month increases in housing starts, prices will continue to
far outpace incomes and put pressure on those trying to buy."
The share of homes sold to first-time
buyers remained unchanged from February at 32 percent, which is up 2 percentage
points from a year ago. The share
averaged 35 percent for all of 2016.
NAR President William E. Brown says
patience is virtue for prospective first-time buyers this spring.
"Realtors in most markets are saying interest from first-timers is up this
year, but competition is stiff for listings in their price range." He advised buyers not to get frustrated by
losing out on a home and "know the right one will eventually come along in due
Individual investors accounted for
15 percent of homes sold in March, down from 17 percent in February but up from
14 percent a year ago. Sixty-three percent of investors paid in cash, and all-cash
sales made up 23 percent of transactions, down from 27 percent in February and
25 percent a year ago.
Sales of foreclosed properties made
up 5 percent of sales during the month and 1 percent were short sales. The two had a combined share of 7 percent of February
sales and 8 percent a year earlier. Foreclosures sold for an average discount
of 16 percent below market value in March (18 percent in February), while short
sales were discounted 14 percent (17 percent in February).
Existing-home sales jumped by 10.1
percent in the Northeast, to an annual rate of 760,000, and are now 4.1 percent
above a year ago. The median price in the Northeast was $260,800, a 2.8 percent
In the Midwest sales rose 9.2
percent to an annual rate of 1.31 million, 3.1 percent above a year ago. The
median price in the Midwest rose 6.2 percent to $183,000.
The South saw existing-home sales rise
3.4 percent to 2.42 million units, an 8.5 percent faster pace than in March
2016. The median price in the South was $210,600, up 8.6 percent
The West was the only region where
sales lagged, down 1.6 percent from February to an annual rate of 1.22 million. Still they remained 5.2 percent higher than
the previous March. The median price in the West was $347,500, an 8.0 percent