U.S. homebuyers pulled back in March as mortgage rates climbed again, sending existing home sales down 5.9% from February — the steepest monthly drop since late 2022.
The National Association of Realtors said Wednesday that sales were also 2.4% lower than a year earlier, despite more homes hitting the market and spring usually being a busy season. High borrowing costs remain the key drag.
Rates for a 30-year mortgage averaged 6.81% last week, up from around 6.6% earlier this year, according to Freddie Mac. Analysts say bond market volatility, spurred in part by President Trump's tariff threats, has pushed rates higher.
Prices continue to rise. The median price for an existing home in March was $403,700 — up from $398,400 in February and $392,900 in March 2024.
Oliver Allen, an economist at Pantheon Macroeconomics, said the housing market remains “frozen,” with a wide gap between current rates and the sub-5% mortgages many homeowners already have.
New homes, however, are holding up better. Sales of newly built single-family homes rose 7.4% in March and were up 6% year over year, according to government data. Builders are focusing on smaller, more affordable homes — a shift that brought the median new-home price to $403,600, nearly the same as existing homes.
Mortgage applications also fell 12.7% in mid-April, a sign more buyers are waiting on the sidelines for better conditions.
