Existing home sales in April faded 3.4% from the month before to an annualized rate of 4.28 million, data from the National Association of Realtors out Thursday showed, as inventory challenges continue to weigh on transaction volume.
The annualized rate fell short of the 4.30 million expected by economists, according to Bloomberg data, and is down 23.2% from a year ago. The median sales price for an existing home also price slipped 1.7% from one year ago to $388,800, NAR data showed.
One of the big factors weighing on the market — the number of houses for sale — did increase in April to 1.04 million units, up 7.2% from March's figure and down just 1% from a year ago, the NAR reported. But the seasonal uptick is smaller than usual.
"It usually runs around 10% between March and April," NAR Chief Economist Lawrence Yun said on the NAR's press conference call. "We have slightly more inventory this year compared to last year just because homes are lingering on the market a little longer."
About 73% of homes sold in April were sitting on the market for less than a month. Inventory sat on the market for 22 days in April, up from 17 days a year ago. Unsold inventory was at a 2.9-month supply, or about half of the 6-month supply level that's considered a healthy market.
Regionally, sales in the Northeast fell 1.9% from March’s figure to an annualized rate of 510,000 in April, underperforming 23.9% from April 2022 levels. The median price in the Northeast was $422,700, up 2.8% from the previous year.
In the Midwest, homes sales slid 1.9% from one month ago to an annual rate of 1.02 million in April, falling 21.5% from the prior year. The median price in the Midwest was $287,300, up 1.8% from April 2022.
Sales in the South fell 3.4% in April from March to an annual rate of 1.98 million, a 20.2% decrease from the prior year. ago. The median price in the South was $357,900, down 0.6% from April 2022.
And in the West, sales dropped 6.1% from the previous month to an annual rate of 770,000 in April, down 31.3% from the previous year. The median price in the West was $578,200, down 8.0% from April 2022.
“Roughly half of the country is experiencing price gains,” Yun said in a press statement. “Even in markets with lower prices, primarily the expensive West region, multiple-offer situations have returned in the spring buying season following the calmer winter market. Distressed and forced property sales are virtually nonexistent.”
Foreclosures and short sales made up 1% of sales in April, unchanged from the last month and the prior year. Individual investors or second-home buyers, who make up many cash sales, purchased 17% of homes in April, unchanged to March's level and one year ago.
While the shortage of homes for sale is hindering homebuyers in the market, it's helped to boost sentiment among single-family homebuilders, with their confidence hitting the highest level in 10 months. That's because many buyers are flowing into the new-home market.
More than a third of homes on the market in April were new construction, the National Association of Home Builders estimated, when that share is typically 13%.
That's created increased incentive for builders to develop more homes. For instance, building advanced in April, reversing March’s drop, according to government data released on Wednesday. Housing starts and permits for single-family homes both increased month over month.
The dearth of housing stock largely stems from a mortgage rate trap.
Currently, 83% of homeowners have mortgages with rates below 5%, according to an analysis from First American Chief Economist Mark Fleming, while the average rate on a 30-year mortgage has been stuck above 6% since mid-September.
"Why would anyone sell their home when it will cost significantly more each month to borrow the same amount from the bank?" Fleming wrote.
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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
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