March Existing Home Sales: The Worst is Still to Come

• March existing home sales were down 8.5% from February but up 0.8% from a year ago, to 5.27 million, according to the National Association of Realtors.
• The median existing-home price for all housing types in March was $280,600, up 8% from March 2019.
• Total housing inventory at the end of March totaled 1.5 million homes, up 2.7% from February but down 10.2% from a year ago.

Today's data are the first definitive signal on just how much the nation's widespread business shutdowns, social distancing measures and general fear and uncertainty are weighing on home sales during the initial phase of the U.S. coronavirus outbreak. On the surface, the numbers are bad, recording the largest monthly decline since November 2015. But as disappointing as they are now, expect them to get worse — April data will tell a much more complete story. March sales activity encompasses the entire month – including the first half, when much the country was still more-or-less open for business. The March data also reflect closed sales that likely went pending in February or even January, a time when the economic outlook was, obviously, far rosier than it was today. While continued declines in sales are almost certain, it is less certain what happens to home prices, which grew in March at their fastest annual pace since 2016. Sidelined buyers that keep their powder dry and stay ready to jump back into the market as soon as they can may sense an opportunity for bargains, though they may find sellers more stubborn and/or willing to wait for their price than first imagined.

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