U.S. Home Price Median Hit High of $375,300 in March
New York, NY, April 21, 2022-U.S. home prices soared to a new record in March while mortgage rates continued to rise rapidly, slowing home sales in what has been the hottest housing market in more than 15 years, reports the Wall Street Journal.
“Existing-home sales fell 2.7% last month from February, the National Association of Realtors said Wednesday. March sales fell 4.5% from a year earlier.
“The rise of remote work and the pursuit of more space unleashed a powerful wave of home buying when Covid-19-related lockdowns started to ease in the middle of 2020. The frenzied housing market, supported by ultralow interest rates at the time, lifted home prices throughout the country. Homes for sale often stayed on the market for less than a month, and sometimes only days, while open houses could draw lines around the block.
“Now, that frenzy is starting to ease and the volume of home sales is reverting to pre-pandemic levels, said Lawrence Yun, chief economist for the National Association of Realtors. With mortgage rates at 5% and back to their highest level since 2011, Mr. Yun said he expects home sales in 2022 to decline 10% from last year.
“The combination of higher borrowing rates and an extremely low inventory of homes for sale has led some buyers to give up. Purchase mortgage application volume was down 3% last week from a week earlier and down 14% from a year ago, according to the Mortgage Bankers Association’s seasonally adjusted index.
“‘We do see a lot of serious, pre-approved buyers that were ready to go just a month ago, and now they’re not in the market anymore,’ said Monika Prasai, a real-estate agent in San Diego.
“But analysts expect home prices to keep climbing, due to limited supply. The inventory of 950,000 homes for sale at the end of March was down 9.5% from March 2021, NAR said. Many homes on the market still receive multiple offers.
“The median existing-home price rose 15% in March from a year earlier to $375,300, NAR said Wednesday, a record high in data going back to 1999.”