The U.S. existing-home sales market saw a slight cooling in April, with transactions dipping by 0.5% from March to a seasonally adjusted annual rate of 4.00 million, according to a report released today by the National Association of Realtors® (NAR). Compared to the previous year, sales were down 2.0% from 4.08 million in April 2024.
Despite the modest slowdown in sales volume, the median existing-home sales price surged 1.8% year-over-year to an April record of $414,000. This marks the 22nd consecutive month of year-over-year price increases, underscoring persistent demand in many areas.
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A significant development for potential buyers is the notable increase in housing inventory. The stock of unsold existing homes jumped 9.0% from March to 1.45 million units by the end of April. This figure is a substantial 20.8% higher than the 1.2 million homes available one year ago and represents a 4.4-month supply at the current sales pace, up from 3.5 months in April 2024.
NAR Chief Economist Lawrence Yun commented on the figures, stating, “Home sales have been at 75% of normal or pre-pandemic activity for the past three years, even with seven million jobs added to the economy.” He added, “Pent-up housing demand continues to grow, though not realized. Any meaningful decline in mortgage rates will help release this demand.”
Yun also noted the shifting market dynamics due to increased supply. “At the macro level, we are still in a mild seller’s market,” he said. “But with the highest inventory levels in nearly five years, consumers are in a better situation to negotiate for better deals.”
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Market Highlights and Buyer Trends:
- Time on Market: Properties typically remained on the market for 29 days in April, a decrease from 36 days in March but up from 26 days in April 2024.
- First-Time Buyers: This group represented 34% of sales in April, an increase from 32% in March and 33% in April 2024. This is a positive sign considering NAR’s 2024 Profile of Home Buyers and Sellers reported the annual share of first-time buyers at 24%, the lowest ever recorded.
- Cash Sales: All-cash transactions accounted for 25% of sales, down slightly from 26% in March and 28% a year ago.
- Investors: Individual investors or second-home buyers purchased 15% of homes in April, consistent with March but down from 16% in April 2024.
- Distressed Sales: Foreclosures and short sales constituted only 2% of sales, unchanged from the previous year.
- Mortgage Rates: According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.81% as of May 15, up from the prior week but down from 7.02% one year ago.
Regional Variations:
Sales performance varied across the country:
- Northeast: Sales fell 2.0% from March to an annual rate of 480,000, identical to April 2024. The median price rose 6.3% to $487,400.
- Midwest: Sales improved by 2.1% in April to an annual rate of 970,000, though down 1.0% year-over-year. The median price increased 3.6% to $313,300.
- South: Sales remained unchanged from March at an annual rate of 1.81 million, a 3.2% decrease from the previous year. The median price slightly dipped by 0.1% to $365,300.
- West: Sales contracted 3.9% in April to an annual rate of 740,000, down 1.3% from a year ago. The median price there decreased by 0.2% to $628,500.
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Property Types: Single-family home sales decreased by 0.3% to a seasonally adjusted annual rate of 3.63 million in April, with the median price at $418,000 (up 1.7% YoY). Existing condominium and co-op sales saw a more significant drop of 2.6% to a rate of 370,000 units, with a median price of $370,100 (up 1.4% YoY).
The April data suggests a housing market still navigating affordability pressures and elevated mortgage rates, but the significant rise in inventory could begin to offer more choices and negotiating power for buyers in the months ahead.
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