Sales of previously owned U.S. homes barely rose in April from a nine-month low, underscoring the sluggish housing market at the start of the spring selling season.
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The number of contracts rose 0.2% to an annual rate of 4.02 million, according to data from the National Association of Realtors released Monday. That was slightly slower than the average estimate in a Bloomberg survey of economists.
Despite the modest improvement in April, the housing market remains under pressure due to high mortgage rates and asking prices. Even with more moderate growth over the past year, buyers are still paying record prices.
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In addition, higher energy costs due to the war in Iran are beginning to put pressure on household budgets.
The NAR report showed that the average sales price rose 0.9% from a year earlier to $417,700 – a record for the month. The inventory of previously owned homes rose to 1.47 million from a year ago – the highest number in April since 2019.
“Even though this is the highest post-Covid inventory, we are not close to the pre-Covid April inventory of 1.83 million,” NAR chief economist Lawrence Yun said on a call with reporters.
According to the NAR, contract closures increased in the Midwest and South. In the West they fell to the lowest level in three months.
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First-time buyers represented 33% of buyers, a slight decrease from a year ago.
Although the NAR’s affordability index – which measures whether a family has sufficient income to qualify for a loan for a typical home – has improved from last year’s lows,