Existing home sales were moderated in March according to data from the National Association of Realtors. This moderation follows the trend established by the rebounding of home sales in February due to increasing confidence amongst buyers.
The existing home sales in March declined on the month-on-month purchasing rate to a 5.60 million. Only a moderate decline in sales stemmed the overall increase that had been seen in February, which was 6.00 million. As such, the year-on-year sales rate rose to a 4.2%.
Part of the minor decline in existing home sales was due to the low availability of homes. The number of available homes for sale slid to 1.55 million, an 8.8% decline from the same time last year. As such, the decline in inventory prevented potential buyers from taking advantage of the rebounding of the market, which prompted the moderation in existing home sales.
It is likely that the decline in inventory will be one of the main areas of focus for future housing markets. This tight inventory has already driven up the average price of existing homes, which rose by 17.2% year-on-year to $342,222 in March. This increase in price is expected to be one of the determinants of whether or not the existing home sales rate can continue to rise.
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