Summary
Positive home-selling sentiment led to growth in the nation’s housing inventory in March. The increase in affordable inventory and a high number of price reductions contributed to a low growth rate in median home listing prices.
Report
In March, the nation’s housing inventory grew due to positive home-selling sentiment, leading to more affordable and newly listed homes being added to the market according to realtor.com. The increase in affordable inventory and the high number of price reductions last month contributed to the nation’s low growth rate in median home listing prices.
Although affordability has increased, there is still a shortage of homes, and prices continue to be higher than in previous years. Despite the impact of high mortgage rates on sellers, the recent increase in newly listed homes indicates a stronger desire to sell compared to March 2023.
In March, the number of homes actively for sale increased by 23.5% compared to March 2023, marking the fifth consecutive month of annual inventory growth. In the first quarter of this year, the number of homes actively listed for sale was the highest it has been since 2020.
Similar to February, home growth in March was highest in the $200,000 to $350,000 range with a 30.5% increase in inventory compared to last year. The total number of available homes for sale, including those under contract, rose by 16.5% compared to last year. March marked the fourth consecutive month of annual growth following 7 months of declines. Pending listings, the number of homes under contract but not yet sold, saw a 6.2% increase, bouncing back from February’s decline.
The average home in March was on the market for 50 days, which is 2 days shorter than March 2023 and about 12 days less than the average March between 2017 and 2019. Despite this, the shrinking inventory is causing the gap between last year and this year to decrease. Compared to February’s $415,500, the national median list price rose seasonally to $424,900 in March with a slight 0.2% increase compared to March 2023.
However, there was also a 2.2 percentage point increase in the share of listings with reduced prices in March compared to last year. The growth in median list price has slowed, and mortgage rates have not increased significantly, remaining at around 6.8% since January. While the cost of purchasing a home continues to increase, the rate of growth is decelerating, providing consumers with a chance to catch up.
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