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Home sales in March fell 8.5% as sellers take real estate off the market

Potential home buyers come with a realtor to a house for sale in Dunlap, Illinois.

Daniel Acker | Bloomberg | Getty Images

According to the National Association of Realtors seasonally adjusted index, property sales declined 8.5% in March compared to February, to an annualized pace of 5.27 million units.

Sales were only 0.8% higher than in March 2019.

These sales figures are based on closures, which are contracts that were largely signed in late January and February before the coronavirus brought much of the economy to a standstill.

“We saw the stock market correction in late February,”

; said NAR chief economist Lawrence Yun. “The first half of March was pretty good, but there was a measurable decline in sales activity in the second half of March.”

Yun said sales could drop 30% to 40% in the coming months.

Regionally, sales declined nationwide, but the strongest in the west, by 13.6% month to month. Sales declined by 9.1% in the south, 7.1% in the northeast and 3.1% in the south.

The supply of houses for sale fell sharply by 10.2% annually. Towards the end of the month, some sellers removed their properties from the list and didn’t want potential buyers to personally visit their homes. Other measures showed a sharp drop in the number of new listings in March, reflecting market anxiety among both buyers and sellers.

“Homes are still selling fast, we just don’t have enough inventory,” added Yun, saying that real estate agents are showing some interest and have started virtual tours and live virtual shows.

Price growth was still strong in March. The median price for existing homes reached $ 280,600, an 8% annual increase.

“In the future, both buyers and sellers have found that they feel less secure, and many are making adjustments to the process,” said Danielle Hale, chief economist at realtor.com. “Sellers are already becoming less aggressive when it comes to price growth, and we see that about half as many new offers are on sale this year as last year.”

Fewer home sales in the coming months are likely to mean slower price growth, and prices could fall in some of the hardest hit markets, where hospitality and leisure spur the local economy.

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