Home Prices See Biggest Annual Decline in More Than a Decade
April 19, 2023
Home sales fell in March, getting the important spring buying season off to a slow start as higher mortgage rates continue to weigh on the market.
Sales of existing homes fell 2.4% in March from the month prior, down to a seasonally adjusted rate of 4.44 million, according to the National Association of Realtors. March’s sales were down a staggering 22% from a year earlier.
Sales have fallen in 13 of the past 14 months. An unexpected uptick in February proved to be shortlived as mortgage rates resumed their climb. Rates have fluctuated in recent months after topping 7% last fall, the highest rate in more than 20 years. After retreating for five straight weeks, mortgage rates crept back up to 6.39% last week. The average rate was 5.11% during the same week last year.
The slowdown in sales activity is starting to weigh on prices. March saw an annual decline, as did February, marking the first time annual prices have fallen in consecutive months in 11 years.
The national median price for an existing home declined 0.9% in March as compared to a year earlier, the biggest year-over-year decline since January 2012.
Other recent data has pointed to slowing activity in the housing sector. Housing starts, a measure of home-building activity, fell 0.8% in March from the month prior, according to the Commerce Department. Residential permits, a proxy for future home construction, were down 8.8%.