Existing home sales fell much more than expected in February.
Data from the National Association of Realtors (NAR) Monday showed that sales of existing single-family homes, condos and coops fell 7.1% to an annual rate of 5.08 million.
“Unshakably low supply levels” and climbing prices across the country contributed to the plunge, according to the NAR.
Economists had estimated, according to Bloomberg, that sales fell 2.9% in February at an annual rate of 5.31 million.
In January, existing home sales rose to the highest annual rate in six months, by 0.4%. The series can be quite volatile on a month-to-month basis.
“The lull in contract signings in January from the large East Coast blizzard, along with the slump in the stock market, may have played a role in February’s lack of closings,” said the National Association of Realtors’ Lawrence Yun in the release. “However, the main issue continues to be a supply and affordability problem. Finding the right property at an affordable price is burdening many potential buyers.“
As Business Insider’s Myles Udland outlined in a post earlier this month, housing demand is accelerating at a faster pace than supply. And so the tight supply is driving up prices, making it harder for people to afford the homes on sale.
The median existing-home price across all types was $210,800 in February, up 4.4% from $201,900 a year earlier. Meanwhile, housing inventory was down 1.1% compared to the same month in 2015.