Prices Up, Sales Down: Navigating Today’s Market
Home sales fell sharply in March as high mortgage rates and broader economic uncertainty weighed on what is traditionally the busiest season for real estate, signaling continued challenges for a housing market now entering its third year of slower activity.
According to the National Association of Realtors, existing home sales dropped 5.9% compared to February—the steepest monthly decline since November 2022. Year-over-year, sales were down 2.4%. While many had hoped the spring season would spark a recovery, the market is still grappling with the lingering effects of elevated rates, affordability challenges, and broader economic pressures such as tariffs and recession concerns.
Affordability hurdles remain a key issue. Elevated mortgage rates—hovering near 7% for the past year—have made it difficult for many buyers to enter the market, even as home prices continue to rise. In March, the national median sale price for an existing home climbed to $403,700, a 2.7% increase from a year ago and a new record for the month. This marks the 21st consecutive month of price gains, though the pace of growth has recently slowed as more homes linger on the market.
The broader housing market slowdown mirrors a general cooling of consumer sentiment, with many Americans delaying major purchases amid tariff concerns and economic volatility. A Redfin survey recently found that nearly a quarter of Americans are canceling plans for big purchases, while another third are opting to wait and see how the economy evolves.
Construction has also faced headwinds. Tariffs on building materials such as lumber and concrete have pushed up costs, causing a 14.2% drop in housing starts for single-family homes in March. Builders report difficulties in delivering affordable homes, which are crucial for first-time buyers and for maintaining a balanced market.
Despite these challenges, there are encouraging signs. Inventory in the existing-home market has been slowly increasing, giving buyers more choices than they had in recent years. Homes are beginning to stay on the market a little longer than they did during the height of the pandemic boom, suggesting a market that is gradually finding more balance between supply and demand.
If you’re thinking about making a move this year — whether buying, selling, or just exploring your options — now is a great time to start the conversation. With more inventory coming to market and potential opportunities ahead, please reach outI’d love to help you navigate the current market and plan for your next steps!
