Sales of previously owned U.S. homes dropped in March by the most since November 2015, representing weaker demand that likely is going to get much worse in coming months as the pandemic bears down on the economy.
Contract closings declined 8.5% from the prior month to an annualized 5.27 million, the slowest since April 2019, from a downwardly revised 5.76 million in February,
The first half of the month “held up reasonably well, but it was the second half of March where we are seeing a measurable decline in activity,” Yun said.
Many potential home sellers are delaying listing their properties in the current economic environment, he noted.
This is the first of the housing data for March and does not bode well…
Business closures and stay-at-home orders that began taking effect mid-month have led to listing delays and caused buyers to postpone purchases, but median home price rose 8% from last year to $280,600 (but the low end is sliding)…
Remember, these are contract closing for sales that were signed late Jan, early Feb and so there could be significantly worse to come.
“Based on what we are seeing at the moment, don’t be surprised if the sales activity could be down as much as 30% or even 40% in the next couple of months,” Lawrence Yun, NAR’s chief economist, said on a call with reporters.
Housing inventory picked up a little in March but remains down 10.2% YoY and at the lowest level for March in history.