Sales of existing homes fell 3.6% in March as prices rose, prompting the National Association of Realtors to lower its annual sales forecast due to rising mortgage rates.
“Mortgage rates have been rising, and that has led us to trim our home sales outlook for the year,” said Lawrence Yun, chief economist at NAR.
The U.S. real estate market continues to face rising prices, low inventory and declining sales. New data from the National Association of Realtors shows how higher mortgage rates and cautious consumer sentiment are dampening activity, forcing experts to revise their expectations for the year ahead.
The national group reduced its forecast for existing home sales in 2026 to a 4% increase, down from the 14% increase it had predicted late last year. The forecast for new-home sales is now flat, down from the previously projected 5% gain. The median home price forecast remains unchanged, with prices still projected to rise 4% in 2026.
President Donald Trump’s administration has been working to lower mortgage rates and push down prices to make housing more affordable. However, a housing shortage could make those goals more challenging. In January, the president pushed the Treasury Department to buy $200 billion in mortgage bonds to lower interest rates.
The average 30-year fixed rate mortgage in March was 6.18%, up from 6.05% in February and down from 6.65% one year ago, according to Freddie Mac.
In March, existing home sales declined to a seasonally adjusted annual rate of 3.98 million, a 3.6% drop from the prior month and 1% below last year, according to NAR.
“March home sales remained sluggish and below last year’s pace,” Yun said. “Lower consumer confidence and softer job growth continue to hold back buyers.”
The median sales price for existing homes rose 1.4% from a year ago to $408,800 in March, marking the 33rd consecutive month of annual price increases.
Housing inventory remains tight, though total inventory grew 3% from February and 2.3% from March 2025 to 1.36 million units. This equals a 4.1-month supply of unsold homes, up from 3.8 months last month and 4 months a year ago. Median time on market was 41 days, down from 47 in February but up from 36 last March. Cash sales were 27%, down from 31% last month but above 26% last March.
“Inventory remains a major constraint on the market,” Yun said. “The inventory-to-sales ratio, or supply-to-demand ratio, is below historical norms. An additional 300,000 to 500,000 homes for sale would help bring the market closer to normal conditions and allow consumers to make purchase decisions without feeling rushed.”
The median age for a first-time home buyer recently hit 40, a record high, according to a November 2025 report from the National Association of Realtors.
