U.S. home sales increased for a second straight month in March amid a rebound in activity in the Northeast and Midwest regions, but a dearth of houses on the market and higher prices remain headwinds as the spring selling season kicks off.
Experts say the supply squeeze is expected to ease somewhat later this year as data last week showed the stock of housing under construction rising in March to levels last seen in July 2007.
The National Association of Realtors in the United States said on Monday that existing home sales rose 1.1% to a seasonally adjusted annual rate of 5.60 million units last month. The market for previously owned homes accounts for about 90% of U.S. home sales. Sales fell 1.2% year-on-year in March.
Sales surged in the Northeast and Midwest, after being weighed down by bad weather in February, but fell in the South and the West.
The NAR says further, that there is an acute shortage of homes, especially at the lower end of the market, with sales of houses priced below $100,000 dropping 21% in March from a year ago.
The resulting higher house prices and rising mortgage rates are a constraint for first-time buyers, who have been largely priced out of the market. First-time home buyers accounted for 30% of transactions last month, up from 29% in February, but down from 32% year ago.
