Potential existing-home sales increased marginally to a 5.24 million seasonally adjusted annualized rate (SAAR), during March, according to new data from First American Financial Corp. This represents a 1.5 percent increase from February and a relatively small 0.3 decline from one year ago.
First American also noted that the potential existing-home sales is 1.5 million (SAAR), or 22.2 percent below the pre-recession peak in March 2004. The market for existing-home sales is underperforming its potential by 2.3 percent or an estimated 121,000 (SAAR) sales, while the market performance gap decreased by an estimated 10,000 (SAAR) sales between February and March.
“While the housing market continued to underperform its potential in March 2019, the green shoots of spring homebuying have emerged,” said First American Chief Economist Mark Fleming. “Ongoing supply shortages remain the main driver of the performance gap as the housing market continues to face an inventory impasse–you can’t buy what’s not for sale. However, an unexpected affordability surge, driven primarily by lower-than-anticipated mortgage rates, rising wages and favorable demographics, has boosted housing demand. The result? The start of a surprisingly strong spring homebuying season.”