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Existing home sales fall three months in row


Existing home sales fall three months in row
Paul Davidson, USA TODAY

The housing market continued to sputter in March as adverse weather, low supplies and higher costs discouraged home buyers.

Existing home sales declined 0.2% to a seasonally adjusted annual rate of 4.59 million, the lowest level since July 2012, the National Association of Realtors said Tuesday. Home sales have fallen in seven of the past eight months.

Still, the market was a bit firmer than expected. Economists’ median estimate was for an annual sales rate of 4.57 million, according to Action Economics’ survey.

A brutal winter continued to play a role in the weak showing. Although March brought milder temperatures and fewer storms, sales activity largely reflected closings on purchase agreements signed in January and February, says Jim O’Sullivan, chief U.S. economist of High Frequency Economics.

Other factors are also holding down sales. The average 30-year fixed mortgage rate is at 4.27%, low by historical standards but up from about 3.4% a year ago. And higher home prices and a tight supply of homes for sale discouraged some buyers, NAR said.

There was a a 5.2-month supply of homes last month, up from a five-month supply in February, but six months is normal. Some of the tight inventory is welcome as the housing market recovers from the 2006 crash. Distressed homes, including foreclosures and short sales, accounted for 14% of sales in March, down from 21% a year ago.

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