March existing home closings disappointed, dropping 5.9% from February – nearly double the forecasted 3% decline. All regions saw decreases, with the West experiencing the largest drop, partly due to California wildfires delaying closings. These figures likely reflect transactions started in January and February when mortgage rates were higher.
What’s the bottom line?
While inventory increased to 1.33 million units (up 8.1% month-over-month and 19.8% year-over-year), context is crucial. Current inventory levels remain near 30-year lows, significantly below pre-pandemic figures and almost 3 million units less than during the housing bubble period. This persistent supply shortage, combined with pent-up buyer demand, is a good sign for continued home price appreciation.