Following a sharp decline in March, existing home sales, released by the National Association of Realtors (NAR), continued to fell in April despite lower interest rates and a strong labor market.
Total existing home sales, including single-family homes, townhomes, condominiums and co-ops, declined 0.4% to a seasonally adjusted annual rate of 5.19 million in April. On a year-over-year basis, sales were 4.4% lower than a year ago. Sales have declined on an annualized basis for more than a year.
The first-time buyer share decreased to 32% in April from 33% both last month and a year ago. The April inventory increased to 1.83 million units from 1.67 million units in March, and rose from 1.8 million units compared to a year ago. At the current sales rate, the April unsold inventory represents a 4.2-month supply, up from a 3.8-month supply last month and 4.0-month supply a year ago.
Homes stayed on the market for an average of 24 days in April, down from 36 days in March and 26 days a year ago. In April, 53% of homes sold were on the market for less than a month.
The April all-cash sales shared 20% of transactions, down from 21% both last month and a year ago.
The April median sales price of all existing homes was $267,300, up 3.6% from a year ago, representing the 86th consecutive month of year-over-year increases. The median existing condominium/co-op price of $251,000 in April was up 3.4% from a year ago.
Regionally, existing home sales were mixed in April. Sales in the Northeast and South fell 4.5% and 0.4% from last month, while sales in the West rose 1.8%. Sales in the Midwest remained unchanged in April. On a year-over-year basis, sales declined in all regions, ranging from 1.7% in the South to 7.9% in the Midwest.
The NAR stated the minor dip in existing home sales should not be overly concerned, as housing market is still underperforming in relation to lower mortgage rates and solid labor market. The historically low mortgage rates and improving job creation and wage growth, combined with the moderating home prices, will lift housing affordability and stimulate the housing market. But NAR also addressed the student loan debt may prevent Millennials from buying houses.