Credit NAR chief economist Lawrence Yun for the Hoot of the Day.
The NAR reports Existing-Home Sales Receded 5.9% in March
Six Key Highlights
- Existing-home sales slipped 5.9percent in March to a seasonally adjusted annual rate of 4.02 million.
- Sales are down 2.4 percent from one year ago.
- The median existing-home sales price climbed 2.7 percent from March 2024 to $403,700, an all-time high for the month of March and the 21st consecutive month of year-over-year price increases.
- The inventory of unsold existing homes jumped 8.1 percent from the previous month to 1.33 million at the end of March,
- Supply is 4.0 months at the current monthly sales pace.
- Sales are down 26.6 percent from the cycle high of 6.34 million in January of 2022.
Existing-Home Sales Percent Change from Month Ago
Existing-Home Sales Percent Change from Year Ago
After a 4-month surge into positive territory based on super-easy comparisons, existing-home sales are now down again year-over-year.
Existing-Home Sales Supply
The cyclical nature of the chart is another sign of seasonal adjustment errors at the NAR.
Despite seasonal adjustments, the data shows strong seasonal tendencies. This also implies faulty seasonal adjustments.
My Comments Last Month
- For three straight years we have seen a February bounce in existing-home sales (yellow highlights in charts).
- Seasonal adjustments, especially for February are questionable.
Long-Term Perspective
Existing-home sales are about where they were in November of 1978.
On a population-adjusted basis (number of households), sales are in the gutter.
Hoot of the Day
“With mortgage delinquencies at near-historical lows, the housing market is on solid footing. A small deceleration in home price gains, which was slightly below wage-growth increases in March, would be a welcome improvement for affordability. With real estate asset valuation at $52 trillion, according to the Federal Reserve Flow of Funds, each percentage point gain in home prices adds more than $500 billion to the household balance sheet.” said NAR perennial cheerleader Lawrence Yun.
If the housing market was on solid footing, population-adjusted sales would not be at or near record lows. I cannot provide a chart of precisely how bad over time because the NAR has restricted access to historical data
But in 1978 there were 76.030 million households. Today there are 132.216 million households. The number of transactions is about the same.
Perhaps Yun means things are so bad, they can’t get any worse. If so, we’ll see about that.
Blame the Fed
Blame the Fed for bubble-blowing monetary policy and Congress for massive debt bubbles that have made housing unaffordable for most of generation Z.
For discussion, please see Fedthink! The Fed Is Incompetent by Design and Can’t Be Fixed
Is the Fed playing politics? Does the Fed know what it’s doing at all?
Also see my March 15, 2025 post The Case-Shiller Home Price Index Hits Another New Record High, Thank the Fed
And, housing prices are still rising. The only reason sales fell is because the media spread economic fear. But, prices just keep rising.
riiiiight, it’s all the “media’s” fault. House prices are rising because homeowners have low mortgage rates and if they sell they’d have to finance at much higher rates, supply is very limited and the people who can afford to buy can afford to pay a bit more.
Existing home sales: Mar 2025 is higher than Mar 2024 and Mar 2024 was higher than Mar 2023.
The annual Demand destruction breadth is shrinking, falling less and less every year, since 2018. It stabilized in the NorthEast. By mid year Demand might rise for the first time since 2018, unless a stock markets plunge will cause a setback. Apt vacancies are rising. Demand is still strong, though not as strong 2 years ago, but vacant apt accumulated. It take more time to reduce the glut, which cause losses.
By analyzing charts on Mish I reduce Wolfstreet
Minneapolis Star Tribune reported today that “competition for Twin Cities homes between $250K and $500K is fiercer than ever.” People are looking to move up and downsize but don’t want cheaper fixer-uppers due to the hassle and more expensive building materials and labor costs. Also, more expensive homes are out of more budgets with the current interest rate.
There’s a lot of newer-construction townhouses in that range….many are 2-story, though, which may not appeal to seniors.
““With mortgage delinquencies at near-historical lows, the housing market is on solid footing.”
Per the below link, fraud and extend and pretend are causing the mortgage delinquencies at near record lows. It is a matter of time before this blows up and housing inventory rises.
Where is DOGE?
https://www.youtube.com/watch?v=dnthJqt0hvs
Be advised the video is a little over 45 minutes but worth your time regarding FHA extend and pretend and fraud.
The Fed’s purchase of MBS during Covid was criminal.
And also the Federal Government’s guarantee of MBS, which was added retroactively during the 2008 financial crisis, despite all MBS at the time explicitly stating (in print, on the legal bond docs) that they were not Federally guaranteed!
i remember you were one of the few guys who called the last blowout in r/e before most people. good work. thanks
Lawrence Yun is the worst economist I have ever read. Why the NAR continues to pay his salary is beyond comprehension.
He’s their Idiot Whisperer. They’ll keep him for as long as he can keep the idjits from getting spooked.
Any other time, this would have been the biggest news story of the week, but it’s not even a big deal compared to what’s going on out there. That’s when you know we’re going now. Ladies and gentlemen, prepare for impact.
remove your crash helmet, impact not worth surviving.
If I ever see the bright white flash of a nuke hitting, I’m heading towards it, not away from it.
Solid footing until all those VA subsidized mortgages tip over, and people start getting their wages garnished for student loans.
Bagdad Bob is back.
Simple solution. Have the Fed do what Trump wants and start lowering rates. This way people can pretend to afford the house they’re buying all the while the dollar is devalued further and inflation kicks in. Note the sarcasm here.
The Fed does not control and cannot lower the 10-year interest rate, the rate that sets the vast majority of mortgage interest rates.
Lowering the short-term rate is all the Fed can do, and arguably should do.
Long-term rates depend on the outlook for inflation, which in turn depends on the Federal fiscal crisis being resolved.
There is no pain-free solution to the fiscal crisis.
If Congress (+ DOGE, +Tariffs) succeed in fixing the imbalance between spending and tax revenues, it means people will have less to spend. This drag on the economy will cause a recession, and house prices will start to come down. But the Federal Government just might stay solvent. (Similar to 1980s.)
If Congress fails to fix the imbalance between spending and tax revenues, then the government will head to insolvency, long-term and mortgage rates will stay high, mortgage rates will stay high, and house prices will also come down, while gold perhaps shoots the moon.
P.S. The NAR’s median price is badly skewed by high-end houses “still selling” while condos and lower end houses have already started tanking.
Have you emailed this explanation to Trump to let him know the Fed lowering rates won’t solve any of his issues? Because he is on a tirade to lower them
The Fed lowering short-term interest rates would make it modestly easier to balance the federal budget. Around 1/4 of the national debt is short-term Bills always maturing within 2 years. The Fed can influence rates out to 2 years.
If $7T in Treasury Bills roll over at rates 1% lower, that’s a $70 billion/year reduction in the deficit. That’s not nearly enough to fix the problem, but it’s enough to make a dent.
This only works if lowering short-term rates doesn’t cause inflation anxiety to spook longer-term rates. A rise in longer-term borrowing costs would offset the drop in shorter-term costs.
So is Trump right or wrong in wanting lower rates?
And is he right or wrong in pressuring the independent Fed to do so (for his own ‘educated’ opinion)?
The problem isn’t precisely what Trump wants, it’s that he is unable to see the bigger picture.
If they lower rates and housing demand picks up prices will rise. They need to eliminate govt subsidies on home purchasing. Right now you can go as low a a 2% down payment along with a number of tricks that allows people who can’t really afford a home to buy home. The financial requirements for home eligibility have now relapsed back to the GFC level.
Appears that NAR is following the lead of wall street with more hype than reality.
Bullshit sells.
“If you can’t dazzle them with brilliance, baffle them with bullshit”
W.C. Fields
Yup, one or two excellent exponents on this forum to be sure.