ARLINGTON, Va.—Existing-home sales dipped 8.5% in March to a seasonally adjusted annual rate of 5.27 million units.
Though the new numbers represent a 0.8% increase in sales versus a year ago, NAFCU Chief Economist and Vice President of Research Curt Long said that is unlikely to continue as social distancing orders keep buyers in their current homes and mass unemployment shakes the economy.
“In a survey by the National Association of Realtors, only 25% of Realtors believed nearly all aspects of a transaction could be completed while respecting social distance,” said Long. “In addition, 60% of realtors responded that buyers are seeking to delay the home-buying process by a couple of months.
“Sellers taking homes off the market will also further tighten near record-low supply and prevent home prices from falling,” Long continued.
The median existing home price rose from $270,100 in February to $280,600 in March. That amount represents an 8% increase from a year ago.
Continued Tumbling
Based on current sales, there was 3.4 months of supply at the end of March, up 0.3 months from February. Analysts consider six months of supply to be roughly balanced between supply and demand.
“NAFCU expects the existing home market to continue to tumble as shutdowns and job losses ripple through the economy, with a partial return in the latter half of the year,” Long concluded.