February Existing Home Sales: A Step Back, but a Promising Path Forward

• February existing home sales fell 6.6% from January, to 6.22 million (SAAR), but were up 9.1% year-over-year according to the National Association of Realtors.
• The median existing-home price in February was $313,000, up 15.8% from February 2020.
• There were 1.03 million homes available for sale in February -- a record low, largely unchanged from January but down 29.5% from a year ago.

While market competition remains elevated and homes continue to sell quickly, new listing activity slowed early in 2021, leaving even fewer homes for would-be buyers to bid on and potentially contributing to a step back in February existing home sales volumes. Harsh winter weather may have also played a role in the slowdown. Recorded existing home sales tend to reflect buying activity in the prior two months, but the winter storms that crippled much of the country last month may have stopped or delayed many closings, leaving a backlog of deals still to clear in coming months. Still, the path forward looks promising. After gradually retreating to begin the year, signs of buyer activity -- especially the level of mortgage applications -- have rebounded in recent weeks, suggesting  many home shoppers are getting a jump on what promises to be a busy spring season. What’s more, improvements in the economy and continued distribution of the COVID-19 vaccine should encourage more homeowners to place their homes on the market.