WASHINGTON – Sales of previously owned homes fell 8.4 percent last month to a seasonally adjusted rate of 6.12 million housing units per year from February’s pace of 6.68 million units, the National Association of Realtors reported today.
The rate was 11.3 percent below the March 2006 pace of 6.90 million units per year, while the median price of $217,000 was 0.3 percent lower than the March 2006 median of $217,600.
Housing inventory declined 1.6 percent over the month to 3.75 million existing homes for sale at the end of March. At March’s diminished sales pace, however, that leaner inventory would last 7.3 months, compared with February’s 6.8-month housing supply.
In the Northeast, existing home sales fell 8.2 percent to 1.12 million per year, 5.1 percent slower than in March 2006. The median price or $268,600 was 0.7 percent lower than a year ago.
The report blamed unusually harsh weather in February for curtailing the house-hunting that would have led to March closings. “For the last couple months, we’ve been expecting a weather ‘hit’ on home sales finalized in March,” said NAR chief economist David Lereah.
“Looking at overall activity in the first quarter, we see that existing home sales averaged 6.41 million – a figure that is moderately higher than the sales pace during the second half of 2006,” Lereah said.
“We also may be seeing some losses as a result of the subprime fallout,” he added. “However, this is masking improved fundamentals in the housing market, with lower mortgage interest rates and motivated sellers.”
According to lender Freddie Mac, the average rate for a 30-year conventional fixed-rate mortgage was 6.16 percent in March, down from 6.29 percent in February and 6.32 percent in March 2006.
“It’s too early to measure a significant impact from tighter lending standards, which should moderately dampen activity, but we’re still looking for existing-home sales to gradually improve during the last half of 2007,” Lereah said.
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