March Home Sales Rebound Since Last Month

According to the National Association of Realtors, home sales rebounded in March.

What went down in February came up again in March, if you’re talking about the housing market.

According to the National Association of Realtors (NAR), home sales rebounded in March. NAR reported a sales gain of 5.1 percent, compared with February, to an annualized rate of 5.33 million homes. Sales were also up year-over-year by 1.5 percent.

“Closings came back in force last month as a greater number of buyers – mostly in the Northeast and Midwest – overcame low inventory levels and steady price growth to close on a home,” said Lawrence Yun, NAR’s chief economist.

Sales totals would have been even better, he added, if not for the shortages of homes for sale, especially at both the low and high ends of the market. Total inventory was 4.5 months of supply at the March rate of sales. Six-month supply is considered a balanced market.

“The choppiness in sales activity so far this year is directly related to the unevenness in the rate of new listings coming onto the market to replace what is, for the most part, being sold rather quickly,” he said.

Northeast leads the sales charge

Northeast markets showed the most strength. The sales jump from February was more than 11 percent in March, compared with a year earlier. Midwestern sales grew 9.8 percent; the South recorded a 2.7 percent rise; and Western region sales inched up 1.8 percent.

Region Home sales % Increase year-over-year Median home price % Change year-over-year
Northeast 700,000 7.7% $254,100 5.8%
Midwest 1.23 million 0.8% $174,800 7%
South 2.25million 2.3% $194,400 4.6%
West 1.15 million -2.5% $320,800 5.9%

Source: National Association of Realtors

Economic signs have been pointing up

The U.S. economy has been showing strength as the housing market geared up for the spring selling season, the hottest time of year for home sales.

Nearly 3 million workers have been added to the employment rolls over the past year and the national unemployment rate has dropped half a percentage point. Wages, after many stagnant years, have even recorded modest gains lately. All this has buoyed the financial prospects — and the confidence — of many Americans. The Conference Board’s index of consumer expectations jumped from 79.9 in February to 84.7 in March.

The stock market is also warming up with the S&P 500 leaping 6.6 percent in March after a rough start to the year. And, luckily for home buyers, interest rates barely budged during the month, hovering around the 3.7 percent mark for a 30-year, fixed rate loan, near historic lows.

All those positive factors should put many Americans who have been playing a waiting game in a better position to finally buy homes.

“With rents steadily rising and average fixed rates well below 4 percent, qualified first-time buyers should be more active participants than what they are right now,” said Yun.

Home prices trend up

With inventories in many areas still tight and demand strengthening, home prices are rising. The median price paid nationally in March was $222,700, up 5.7 percent year-over-year, the 49th straight month of gains.

Nationally, rents have trended up and that has encouraged purchases by real estate investors, who have been adding to the demand for homes. In 2015 investment home sales hit 1.09 million units, up 7 percent from the year before. While a good sign for the market, this does sap listings that might otherwise be snapped by buyers looking to occupy the homes.

Les is a Real Estate Market Specialist for Coldwell Banker Real Estate.

Born and raised in Whitestone, N.Y., and never having lived outside of NYC, Les is a graduate of City College of New York in Manhattan. Les switched careers in his late 30s, studying writing at New School and Brooklyn Polytechnic, now the New York University Polytechnic School of Engineering. Les has written for several magazines and copyedited books on early childhood education prior to joining CNNMoney as a personal finance writer, where his main beat was real estate. His wife and partner of 42 years is a retired magazine editor who spent her career at the New York Zoological Society (Bronx Zoo). They are residents of the Upper West Side.

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