ARLINGTON, Va.—Existing home sales fell 2.4% in April to a seasonally adjusted annualized rate of 5.61 million units, representing a 5.9% decrease in sales compared to last year.
“Existing home sales fell for the third straight month in April. The inventory-to-sales ratio rose slightly, evidence that demand is cooling due to higher mortgage rates,” said NAFCU Chief Economist and Vice President of Research Curt Long.
“Fannie Mae's Home Purchase Sentiment Index sunk to its lowest level since May 2020," added Long. "Furthermore, respondents expressed heightened concerns about housing affordability and rising mortgage rates."
Based on current month sales, there were 2.2 months of supply in April, up slightly from 1.9 months in March, with analysts considering six months of inventory a rough balance between supply and demand.
Sales fell in half of the regions last month, with the West falling by 5.8%, followed by a 4.6% decline in the South. Sales in the Midwest grew by 3.1%, while in the Northeast sales were up by 1.5%.
“Despite the 30-year fixed mortgage rate having reached 5.1% at the end of the month and a record setting 122 months of consecutive year-over-year price increases, demand remains relatively high," noted Long. "According to the National Association of Realtors, properties averaged 17 days on the market in April (the same pace as March), and 88% of homes were sold within the month.
Trending ‘Flat’
"First-time homebuyers represented 28% of sales in April, which was two percentage points lower than in March," concluded Long. "NAFCU expects home sales totals to trend flat this year due to higher rates and inventory shortages."
Of note, the median existing-home price, non-seasonally adjusted, jumped in April to $391,200, which is 14.9% higher than last year.