Prospective homebuyers gather outside a suburban house with a Zillow for-sale sign.
The U.S. housing market is showing signs of resilience this spring, with home sales up 3.7% year-over-year in March, according to Zillow. This growth comes despite rising mortgage rates that have slightly dampened affordability improvements.
Zillow’s latest market report reveals a 4.6% increase in newly pending home listings compared to last year. This surge brings the total number of listings to the second-highest monthly figure since the pandemic boom ended in August 2022.
The rise in market activity occurred even as mortgage rates climbed from 5.98% at the end of February to 6.38% in late March, according to Freddie Mac data. Consequently, the typical monthly mortgage payment, excluding taxes and insurance, increased by 1.5% from February to $1,789, assuming a 20% down payment. However, this figure remains 4.4% lower than the previous year.
Available housing inventory also saw positive movement, with 1.23 million homes listed for sale in March. This represents a 9.5% increase from February and a 4.2% rise compared to the same time last year.
New for-sale listings totaled 384,854 in March, marking a 0.1% increase from a year ago and a substantial 35.6% jump from February. Newly pending listings, which track homes transitioning from ‘for sale’ to ‘pending’ status, grew by 4.6% year-over-year and 29.8% month-over-month.
Preliminary data from Zillow indicates that 300,398 homes were sold in March, a 3.7% increase from last year and a 25.2% rise from February. These figures are subject to revision later in the month.
Zillow Chief Economist Mischa Fisher notes that the market has adapted to uncertainty and volatility. He points to pent-up demand, the impact of winter storms earlier in the year, and the tailwind from lower mortgage rates as factors buoying the market as the home shopping season begins. The economist highlighted the rapid acceleration of daily page views per listing in March as a significant improvement over recent years.
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