Home sales fell to a 10-year low in April as buying and selling have been challenged by the COVID-19 pandemic, according to the National Association of Realtors (NAR).
For the second consecutive month, each of the nation’s four regions saw sales dwindle in year-over-year sales, with the West seeing the greatest dip.
Total existing-home sales – including single-family homes, townhouses, condominiums and co-ops – dropped 17.8 percent in April to 4.3 million, compared to the same month a year ago when sales were 5.2 million.
“The economic lockdowns, occurring from mid-March through April in most states, have temporarily disrupted home sales,” said Lawrence Yun, NAR’s chief economist, in a statement.
The last time sales were this anemic was in July 2010, when 3.4 million sales were reported, NAR said.
Despite falling sales, median home prices for all housing types continued to rise in every region of the country last month to $286,800, up 7.4 percent from April 2019 when the median was $267,000.
“Record-low mortgage rates are likely to remain in place for the rest of the year, and will be the key factor driving housing demand as state economies steadily reopen,” Yun said.
The average rate for a 30-year, fixed-rate mortgage dropped to 3.31 percent in April, down from 4.1 percent one year ago, according to Freddie Mac.
April home sales in the Northeast fell by 18 percent in April compared to 2019, while existing-home sales decreased 12 percent in the Midwest. Sales in the South saw a nearly 17 percent drop in April, and year-over-year sales were off by 6.4 percent in the region. Home sales in the West declined 27 percent decline from a year ago.
Properties remained on the market for an average of 27 days in April, up from 24 days for the same month last year.
Still, 56 percent of homes sold in April were on the market for less than a month, NAR reported.
First-time buyers were responsible for 36 percent of sales in April, up from 32 percent in April of 2019.
On Wednesday (May 20), the Mortgage Bankers Association reported that home loan applications decreased by 2.6 percent for the week ending May 15, compared to one week earlier. And while mortgage interest rates are at rock bottom, MBA’s data found the refinance share of mortgage activity decreased to 64.3 percent of total applications, from 67 percent the previous week.
“Despite mortgage rates remaining close to record lows … the average loan amount for refinances fell to its lowest level since January, potentially a sign that part of the drop was attributable to a retreat in cash-out refinance lending as credit conditions tighten,” said Joel Kan, MBA’s associate vice president, in a statement.