Existing home sales declined 3 percent to a seasonally adjusted annual rate of 4.57 million units in March from a downwardly revised level of 4.71 million in February, 7.1 percent lower than the 4.92 million-unit pace in March 2008, the National Association of Realtors (NAR) reported.
The previous housing sales report out last month had given hope to the homebuilding, construction and construction equipment industries that the housing slump had finally reached bottom.
NAR chief economist Lawrence Yun said the market appears to be stabilizing with modest monthly ups and downs and that first-time buyers are driving the market. First-time buyers accounted for 53 percent of transactions, NAR said.
"The share of lower priced home sales has trended up, indicating a return of many first-time buyers, which we also see in a parallel member survey," Yun said.
Prices rose 4.2 percent from February to March, but the national median existing-home price for all housing types was $175,200, still down 12.4 percent from March 2008, NAR reported.
"Buyer traffic has been rising and real estate offices are getting phone inquires about the [federal first-time homebuyer] tax credit," Yun said. "By early summer we should be seeing a positive impact on home sales from record-low mortgage interest rates in addition to the stimulus provisions."