The housing market remained soft in April, a new report by the National Association of Realtors (NAR) shows. Sales of existing homes — previously occupied properties, rather than newly built homes — resumed their long downward slide. The number of sales in April was off 3.4% from last month and 23.2% compared to April 2022.
“The combination of job gains, limited inventory and fluctuating mortgage rates over the last several months have created an environment of push-pull housing demand,” NAR chief economist Lawrence Yun said in a statement.
Home prices, meanwhile, were up from March but down 1.7% from April 2022. It was the largest year-over-year decline in home prices since January 2012, Yun said.
“The fate of the housing market in the coming months will be dictated in part by the direction of mortgage rates, as well as the health of the broader economy,” said Mark Hamrick, Bankrate’s senior economic analyst. “The market could benefit from a combination of tailwinds, if they were to develop and are sustained, including easing inflation.”
Existing-home sales continue to decline
The existing-home sales statistic counts all completed sales of non-new-construction homes, including single-family houses, condos, townhouses and co-ops. According to NAR, the number of sales nationally declined to an annual pace of 4.28 million homes in April 2023, well below historical averages.
Regionally, existing-home sales mirrored the overall numbers, with both month-over-month and year-over-year declines in all four regions. Sales in the West saw the biggest yearly drop at 31.3%, with a 6.1% decrease in the past month. In the South, sales fell 3.4% month-over-month and 20.2% from a year earlier. Midwest sales decreased 1.9% from March and 21.5% from one year ago. And the Northeast saw a 1.9% monthly decline and fell 23.9% year-over-year.
The length of time properties sat on the market in April improved to 22 days, compared to 29 days in March and 34 days in February. However, the year-over-year jump was large: The typical number of days on market in April 2022 was just 17.
Yun says home sales are poised to bounce back. “With overall consumer price inflation calming and rents expected to decelerate from robust apartment construction, the Federal Reserve’s monetary policy will surely shift from tightening to neutral to possibly loosening over the next 12 months,” he said. “Therefore, home sales will steadily rebound despite several months of fluctuations.”
Median sale prices continue falling as well
The nationwide median sale price for existing homes rose month-over-month to $388,800. However, compared to April 2022, the median price fell 1.7%, which is three months in a row of year-over-year declines after a long streak of rising. Before February’s year-over-year drop, the U.S. housing market had been on a remarkable run of 131 consecutive months of year-over-year median sale price increases — the longest-running streak since NAR started keeping records.
Regionally, the West has the highest median price by far at $578,200, down 8% from a year ago. In the Northeast, the median rose 2.8% to $422,700. The South and Midwest both saw more modest year-over-year shifts, with the South’s median price falling 0.6% to $357,900 and the Midwest’s rising 1.8% to $287,300.
Housing inventory remains low
Total housing inventory — the overall number of homes on the market for sale — sat at 1.04 million units at the end of April. The number is up 7.2% from March and 1% from a year ago. Despite these modest gains, that still represents only a 2.9-month supply, which is well short of the 5 to 6 months typically required for a healthier, more balanced market.
