Existing-Home Sales Dip in April, Inventory Grows 16.3%

Key takeaways:

• April existing-home sales decreased 1.9% month-over-month and 1.9% annually
• The nationwide median existing-home sales price hit $407,600 in April — a 5.7% rise from the previous year
• The inventory of unsold existing homes grew 9% month-over-month and 16.5% year-over-year to a 3.5-month supply at the current pace of sales

Existing home sales dip

Existing-home sales decreased 1.9% in April compared to both the previous month and year, according to the National Association of Realtors (NAR).

Meanwhile, the median existing-home sales price grew to $407,600. That rose 5.7% annually from $385,800.

“Home prices reaching a record high for the month of April is very good news for homeowners,” said NAR Chief Economist Lawrence Yun. “However, the pace of price increases should taper off since more housing inventory is becoming available.”

Regionally, the South had the most existing-home sales in April, with an annual rate of 1.9 million units. That actually fell 1.6% from March and 3.1% year-over-year. The median price grew 3.7% annually to reach $366,200.

The Midwest’s 1.03 million units came next, a 1% dip both monthly and annually. Its median price rose 6% to $303,600.

The West accounted for 760,000 existing sales, retreating 2.6% from March while inching up 1.3% from April 2023. Typically the costliest part of the country, the median price increased annually by 9.3% to $629,600.

The Northeast’s 480,000 sales dipped 4% month-over-month and year-over-year. The median price jumped 5.5% from the prior year to $458,500.

Factors influencing the market

NAR Chief Economist Lawrence Yun has pointed to two significant factors impacting existing-home sales: low for-sale inventory and high mortgage rates.

Given the ongoing lack of supply, properties on the market still receive multiple offers, especially starter- and mid-priced homes, he said. Although we saw plenty of interest rate growth in 2023, the average 30-year fixed rate mortgage (FRM) came down every month from October 2023 to January 2024 before stepping up in February, March and April. With inflation proving harder to bring down, it’s possible the anticipated interest rate descension may take longer than originally expected.

“The housing market continues to unthaw slowly amid considerable affordability challenges brought on by high interest rates and rising homeownership expenses,” said CoreLogic Chief Economist Dr. Selma Hepp. “Lower mortgage rates later this year will provide a breather, though the average potential home buyer continues to maintain a wait-and-see approach. Improvements in existing for-sale inventory are critical and will help thaw out sales further.”

Other notable data from the report showed April’s housing inventory reached 1.21 million units, a 3.5-months supply at the current sales pace. The total represents a 9% increase month-over-month and 16.3% year-over-year. The months-supply increased March’s 3.2 months and April 2023’s 3 months. Traditionally, six months worth of inventory defines a balanced housing market.

Additionally, time on market hit 26 days in April, faster than March’s 33 days but slower than 22 days the previous year. All-cash buyers accounted for 28%, static compared to month- and year-ago rates.

Navigating the housing market

Embarking on the journey to homeownership is an exciting and significant step in one’s life. To help you navigate this path successfully, we’ve compiled three practical tips:

1. Stay on top of housing inventory: Keep an eye on changes in inventory levels, as this can impact your choices and negotiation power. Be ready to act when the right opportunity arises.
2. Assess your budget and financing options: With low housing affordability being a factor in declining sales, it’s crucial to evaluate your financial circumstances. Explore different financing options and ensure that you find a home that aligns with your budget and long-term financial goals.
3. Be proactive and act quickly: When you find a home that meets your criteria, be proactive and act quickly to avoid missing out. The best way to do so is by securing a mortgage prequalification in advance.

The bottom line

As a homebuyer, navigating the current real estate market can feel overwhelming at times. But armed with the right knowledge, you can approach the process with confidence.

Stay informed about the latest trends, assess your budget, explore down payment assistance programs in your area, and act quickly when you find the right home.