The sales of existing homes went down for the third consecutive month in April, slowing to a pace that was not seen since June 2020.
According to a report by the National Association of Realtors on Thursday, sales of homes that were previously occupied decreased by 2.4% last month compared to March. It also declined 5.9% compared to a year before.
The decline in these homes’ demand has been expected due to the surge in interest rates and the seemingly continuous rise of already expensive home prices. Many economists believe this trend will possibly continue.
Sales of Existing Homes Slows Down to Pre-Pandemic Level
Existing Home Sales Skid to Pre-Pandemic Level, a Housing Bust is Underway
Existing home sale declined for the third month. It's just a start of what's coming.https://t.co/54bxXylp83
— Mike "Mish" Shedlock (@MishGEA) May 19, 2022
“Higher home prices and sharply higher mortgage rates have reduced buyer activity,” NAR chief economics Lawrence Yun said. “It looks like more declines are imminent in the upcoming months, and we'll likely return to the pre-pandemic home sales activity after the remarkable surge over the past two years.”
Also in April, the inventory of unsold houses that are still on the market reached 1.03 million units. This is a 10.8% increase compared to March and a 10.4% decrease from the same time last year.
“Housing supply has started to improve, albeit at an extremely sluggish pace,” said also said.
He then mentioned that “The market is quite unusual as sales are coming down, but listed homes are still selling swiftly, and home prices are much higher than a year ago.”
According to the NAR report, the median sales price of existing homes went up in April by 14.8% year over year to $391,200.