“Home sales bounced back in February because of a decline in mortgage rates that made homes a little more affordable,” said Holden Lewis, home and mortgage expert at NerdWallet. “Most of these February closings were the consummation of offers that were accepted in December and January. Home buyers got a breather in those two months because mortgage rates dipped about half a percentage point compared to rates in the fall. Rates have risen since then, and home sales are likely to slow again in the next few months.”
According to Freddie Mac, the average 30-year fixed mortgage rate fell 13 basis points to 6.60% as of March 16.
“Conscious of changing mortgage rates, home buyers are taking advantage of any rate declines,” NAR chief economist Lawrence Yun added. “Moreover, we’re seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs.”
Total housing inventory remained near record lows at 980,000 units in February, unchanged from January and up 15.3% from last year. Unsold inventory sits at a 2.6-month supply, down 10.3% from the previous month but up from 1.7 months a year ago.
“Inventory levels are still at historic lows,” Yun added. “Consequently, multiple offers are returning on a good number of properties.”