Housing Market Reaches Record-High Home Price and Gains in March

Existing-home sales fell in March, marking two consecutive months of declines, according to the National Association of Realtors®. The month of March saw record-high home prices and gains. While each of the four major U.S. regions experienced month-over-month drops, all four areas welcomed year-over-year gains in home sales.

Total existing-home sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, decreased 3.7 percent from February to a seasonally-adjusted annual rate of 6.01 million in March. Sales overall climbed year-over-year, up 12.3 percent from a year ago (5.35 million in March 2020).

“Consumers are facing much higher home prices, rising mortgage rates, and falling affordability, however, buyers are still actively in the market,” said Lawrence Yun, NAR’s chief economist.

“The sales for March would have been measurably higher, had there been more inventory,” he added. “Days-on-market are swift, multiple offers are prevalent, and buyer confidence is rising.”

Yun said although mortgage rates have risen a tick, they are still at a favorable level and the economic outlook is promising.

“At least half of the adult population has received a COVID-19 vaccination, according to reports, and recent housing starts and job creation data show encouraging dynamics of more supply and strong demand in the housing sector.”

The median existing-home price for all housing types in March was $329,100, up 17.2 percent from March 2020 ($280,700), as prices increased in every region. March’s national price jump marks 109 straight months of year-over-year gains.

Realtor.com’s Market Hotness Index, measuring time-on-the-market data and listing views per property, revealed that the hottest metro areas in March were Manchester, New Hampshire; Concord, New Hampshire; Vallejo, California; Burlington, North Carolina; and Springfield, Ohio.

Total housing inventory at the end of March amounted to 1.07 million units, up 3.9 percent from February’s inventory and down 28.2 percent from one year ago (1.49 million). Unsold inventory sits at a 2.1-month supply at the current sales pace, marginally up from February’s 2.0-month supply and down from the 3.3-month supply recorded in March 2020. Inventory numbers continue to represent near-historic lows; NAR first began tracking the single-family home supply in 1982.

Properties typically remained on the market for 18 days in March, down from 20 days in February and from 29 days in March 2020. Eighty-three percent of the homes sold in March 2021 were on the market for less than a month.

First-time buyers were responsible for 32 percent of sales in March, up from 31 percent in February and down from 34 percent in March 2020. NAR’s 2020 Profile of Home Buyers and Sellers – released in late 2020 – revealed that the annual share of first-time buyers was 31 percent.

Individual investors or second-home buyers, who account for many cash sales, purchased 15 percent of homes in March, down from 17 percent in February and up from 13 percent in March 2020. All-cash sales accounted for 23 percent of transactions in March, up from both 22 percent in February and from 19 percent in March 2020.

Single-family and Condo/Co-op Sales

Single-family home sales decreased to a seasonally-adjusted annual rate of 5.30 million in March, down 4.3 percent from 5.54 million in February, and up 10.4 percent from one year ago. The median existing single-family home price was $334,500 in March, up 18.4 percent from March 2020.

Existing condominium and co-op sales were recorded at a seasonally-adjusted annual rate of 710,000 units in March, up 1.4 percent from February and up 29.1 percent from one year ago. The median existing condo price was $289,000 in March, an increase of 9.6 percent from a year ago.

Regional Breakdown

In comparison to one year ago, median home prices rose in each of the four major regions.

March 2021 saw existing-home sales in the Northeast slip 1.3 percent, recording an annual rate of 760,000, a 16.9 percent jump from a year ago. The median price in the Northeast was $364,800, up 21.4 percent from March 2020.

Existing-home sales in the Midwest declined 2.3 percent to an annual rate of 1,280,000 in March, a 0.8 percent rise from a year ago. The median price in the Midwest was $248,200, a 13.5 percent increase from March 2020.

Existing-home sales in the South dropped 2.9 percent, recording an annual rate of 2,700,000 in March, up 15.9 percent from the same time one year ago. The median price in the South was $283,900, a 15.6 percent climb from a year ago.

Existing-home sales in the West fell 8.0 percent from the month prior, posting an annual rate of 1,270,000 in March, a 15.5 percent rise from a year ago. The median price in the West was $493,300, up 16.8 percent from March 2020.

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