Sales of previously owned homes fell in February, according to the National Association of Realtors. Sales were down 7.2 percent from the month before and 2.4 percent from last year at the same time. There were a number of factors that likely contributed to the decline, including higher mortgage rates and a lower than normal number of homes for sale.
But while challenges remain, there are signs a better balanced market may be on the way. Lawrence Yun, NAR's chief economist, says inventory is beginning to improve. “The sharp jump in mortgage rates and increasing inflation is taking a heavy toll on consumers' savings,” Yun said. “However, I expect the pace of price appreciation to slow as demand cools and supply improves somewhat due to more home construction.” He may be right. Recent data shows that not only has the pace of new home construction increased so far this year, but the number of existing homes for sale in February rose as well.
Still, the typical property was only on the market 18 days during the month, down a day from January. That means buyers still need to be prepared for a fast-moving market.
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