The US housing market is experiencing its largest monthly fall in sales since 2022, with existing home sales declining by 5.9% from February to March, according to recent data. This decline comes as a surprise after an uptick in sales in February and is attributed to the ongoing high mortgage rates.
Mortgage rates have jumped higher in the last two weeks, increasing the average rate for a 30-year fixed-rate mortgage to 6.81% over the last week. Despite this, home prices continue to climb, with the median existing home sales price reaching $403,700 in March, up from $392,900 last year and $398,400 in February.
Experts expect home sales to “flatline at best” amid these high mortgage rates. The low home sales could signal a broader issue of economic mobility, as people’s economic status may be frozen due to the disparity between new mortgages and existing mortgages.
In contrast, new single-family home sales rose 7.4% from February, with a median sales price of $403,600 in March, which is lower than expected given the usual premium for new homes. This indicates that homebuilders are shifting towards constructing smaller, cheaper homes, which could be good news for buyers priced out of the existing market.
However, despite this positive trend in new home sales, mortgage applications decreased 12.7% from one week earlier, due to the recent jump in mortgage rates. The US economy is expected to continue being influenced by high mortgage rates and economic uncertainty, posing challenges for potential borrowers.
Source: https://www.npr.org/2025/04/24/nx-s1-5375071/home-sales-march-spring-housing