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US pending home sales sank 20.8% in March

AP Economics Writer | Hagadone News Network | UPDATED 5 years, 7 months AGO
by AP Economics Writer
| April 29, 2020 7:27 AM

BALTIMORE (AP) — U.S. home sales showed signs of collapsing in March, as the number of contract signs plunged sharply because of the coronavirus outbreak.

The National Association of Realtors said Wednesday that its pending home sales index, which measures signed buyer contracts, plummeted a seasonally adjusted 20.8% in March from the prior month to a reading of 88.2. That is the lowest level since May 2011, when the housing market was still dealing with foreclosures and crashing prices from the Great Recession. Pending sales have fallen 16.3% from a year ago.

The economic shutdown resulting from COVID-19 has hit real estate hard. Sales listings were already tumbling, but would-be buyers are now also coping with a rattled stock market and an uncertain job outlook as 26 million people have filed for unemployment aid in the past five weeks. Still, the Realtors expect sales to begin recovering once the outbreak subsides because mortgage rates have been historically low.

Housing had been looking up before the virus spread. The Census Bureau said Tuesday that the home ownership rate climbed during the first three months of this year to 65.3%, up from 64.2% a year earlier. The share of people under 35 owning homes has jumped to 37.3% from 35.4% a year ago, though they have been less likely than prior generations to own a home.

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