Sales of previously owned US homes in March declined 3.6 percent from the previous month, data released Monday showed, amid a worsening interest rate outlook since the start of the war in the Middle East.
Just under 4 million homes and apartments changed hands during the month on an annualized basis, according to the National Association of Realtors (NAR), down one percent from the same month last year and below expectations.
Analysts had predicted the figure would come in at 4.05 million units, according to the consensus published by MarketWatch.
"March home sales remained sluggish and below last year’s pace," NAR Chief Economist Lawrence Yun said. Lower consumer confidence and softer job growth also discouraged buyers, he said.
The median selling price in March rose 1.4 percent from a year ago to $408,800, thanks to a limited inventory of homes available.
The market typically picks up in the spring, when real estate agents hold open houses at homes for sale and buyers are looking to move over the summer.
But the limited number of available homes "remains a major constraint on the market," said Yun.
Mortgage rates have risen since the outbreak of fighting in the Middle East, prompting the NAR to trim its home sales outlook for the year to a four percent gain, he said.
Interest rates on 30-year mortgages, the most popular type in the United States, averaged 6.37 percent as of April 9, according to the government-sponsored financing agency Freddie Mac.
They had fallen below the symbolic six percent threshold at the end of February, before the United States and Israel started bombing Iran.
The war has increased energy and other prices, prompting lenders to raise interest rates.