U.S. Home Sales Decline 3.6% in March Amid High Rates and Prices

Home sales in the U.S. fell 3.6% in March, marking a slowdown in the traditional start of the spring buying season. High mortgage rates, record home prices, and limited inventory contributed to the drop.

This decline occurred during what is typically the beginning of the peak real estate season. Buyers faced persistent challenges from high mortgage rates and elevated home prices.

The median home price reached $408,800 in March, setting a record high for that month and marking the 33rd consecutive monthly increase. Limited housing inventory exacerbated the situation, with demand exceeding supply. Many homeowners retained low mortgage rates from previous years, reducing the number of properties available for sale.

Factors Influencing the Market Higher unemployment and persistently high mortgage rates were likely to act as a “slight drag on the spring season,” as stated by Zillow’s chief economist. The outlook for 2026 changed drastically depending on how long high rates and unemployment weigh down the housing market.

If the numbers normalize by May, home sales for the year would rise 3.48%, a percentage point less than the previous estimate. But if the same conditions persist for the whole year, home sale numbers are more likely to decline compared with 2025.

These conditions led prospective buyers to prioritize affordability over seasonal trends.

NAR revised its expectations for home sales growth this year to 4%, down from its earlier projection of 14% released last fall. NAR’s chief economist noted that adding between 300,000 and 500,000 homes for sale would help return the market “closer to normal conditions.”