Realtors Association Slashes Forecast For 2026 Despite Dip In Mortgage Rates

U.S. home sales dipped last month to their slowest pace in nine months, indicating a sluggish start to what is typically the busiest season for the housing market. A report from the National Association of Realtors (NAR) revealed that existing home sales fell 3.6% in March from February to an annual pace of 3.98 million units. On a year-over-year basis, home sales dipped 1%, weighed down by declines in the Northeast and Midwest. The latest sales figure fell short of the roughly 4.06 million pace economists were expecting, according to FactSet. Mortgage Rates Dip The decline in sales came despite the dip in mortgage rates, as economic uncertainty and affordability challenges continue to weigh on home sales. According to an AP report, the average US long-term mortgage rate eases after rising five weeks in a row. Per the mortgage-finance company Freddie Mac, an average rate for the 30-year fixed mortgage stands at 6.37% as of Apr. 9, down from 6.7% for the week ended Feb. 26. The 15-year fixed mortgage averaged 5.74%, down from 5.94% for the same time frame. "Lower consumer confidence and softer job growth continue to hold back buyers," Lawrence Yun, NAR's chief economist, said in a statement. Median Price Rise The national median sales price increased 1.4% year-over-year in March to $408,800, an all-time high for any March on data going back to 1999, NAR said. "Because inventory remains limited, the median home price rose to a new record high for the month of March," Yun added. The inventory of existing homes increased 3.0% month-over-month and 2.3% year-over-year to 1.36 million units in March. It indicates a 4.1-month supply of unsold inventory, up from 3.8 months last month and up from 4.0 months a year ago, though it remains well below pre-pandemic levels. NAR Slashes 2026 Home Sales Outlook The NAR expects existing home sales to grow 4% for 2026, down from the previous projection of 14%. Mortgage rates have risen sharply since the Iran war began in late February. The average rate on a 30-year mortgage had dropped to under 6% in late February for the first time since late 2022. Yun said, "Even with a more modest pace of sales growth, home prices continue to steadily increase due to minimal inventory growth." Photo courtesy: Shutterstock