It’s the third monthly decline in a row. NAR cites the lack of inventory for the slowdown, as well as the increase in median price to $341,600, up 19.1% year-to-year.
WASHINGTON – Existing-home sales waned in April, marking three straight months of declines, according to the National Association of Realtors® (NAR). All but one of the four major U.S. regions tracked by NAR saw month-over-month drops in home sales, but each also registered double-digit year-over-year gains for April, in part due to the rise of the pandemic one year ago.
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – slipped 2.7% from March to a seasonally-adjusted annual rate of 5.85 million in April. Sales overall jumped year-over-year, up 33.9% from a year ago (4.37 million in April 2020).
“Home sales were down again in April from the prior month, as housing supply continues to fall short of demand,” says Lawrence Yun, NAR’s chief economist. “We’ll see more inventory come to the market later this year as further COVID-19 vaccinations are administered and potential home sellers become more comfortable listing and showing their homes. The falling number of homeowners in mortgage forbearance will also bring about more inventory.
“Despite the decline, housing demand is still strong compared to one year ago, evidenced by home sales from this January to April, which are up 20% compared to 2020,” Yun adds. “The additional supply projected for the market should cool down the torrid pace of price appreciation later in the year.”
The median existing-home price for all housing types in April was $341,600, up 19.1% from April 2020 ($286,800) – a record high and a continuation of 110 straight months of year-over-year gains.
Total housing inventory at the end of April amounted to 1.16 million units, up 10.5% from March’s inventory but down 20.5% from one year ago (1.46 million). Unsold inventory sits at a 2.4-month supply at the current sales pace, slightly up from March’s 2.1-month supply and down from the 4.0-month supply recorded in April 2020.
The inventory numbers continue to represent near-record lows since NAR first began tracking the single-family home supply in 1982.
The time between listing a property and having it go under contract also continued to tighten in April. Properties typically remained on the market for 17 days last month, down from 18 days in March and 27 days in April 2020. Of all homes on the market in April, 88% went under contract in less than a month.
First-time buyers bought almost 1 in 3 homes (31%) in April, down from 32% in March and 36% in April 2020.
“First-time buyers, in particular, are having trouble securing that first home for a multitude of reasons, including not enough affordable properties, competition with cash buyers and properties leaving the market at such a rapid pace,” Yun says.
Individual investors or second-home buyers, who account for many cash sales, purchased 17% of homes in April, up from 15% in March and 10% in April 2020. All-cash sales accounted for 25% of transactions in April, up from both 23% in March and 15% in April 2020.
Distressed sales – foreclosures and short sales – represented less than 1% of sales in April, equal to March’s percentage but down from 3% in April 2020.
According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 3.06% in April, down slightly from 3.08% in March. Yun expects the 30-year fixed-rate mortgage to remain below 3.5% in 2021.
Single-family and condo/co-op sales: Single-family home sales dropped to a seasonally-adjusted annual rate of 5.13 million in April, down 3.2% from 5.30 million in March, and up 28.9% from one year ago. The median existing single-family home price was $347,400 in April, up 20.3% from April 2020.
April existing condominium and co-op sales were at a seasonally-adjusted annual rate of 720,000 units, up 1.4% from March and up 84.6% from one year ago. The median existing condo price was $300,400 in April, a 12.6% increase from a year ago.
“The demand for homeownership in America is as strong as it’s ever been, and NAR continues working with policymakers across the country to find solutions to the issues we face in our industry,” says NAR President Charlie Oppler. “Ultimately, though, buyers still recognize that securing a home is one of the best ways to build long-term wealth, and Realtors continue their work to make that dream a reality for families everywhere.”
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