(Kitco News) - The gold market continues to tread water above $4,700 an ounce and is not seeing much reaction to disappointing housing market data, as U.S. consumers remain hesitant to buy existing homes.
Total existing-home sales—including single-family homes, townhomes, condominiums, and co-ops—dropped 3.6% in March to a seasonally adjusted annual rate of 3.98 million, down from February’s revised rate of 4.13 million, the National Association of Realtors announced Tuesday. The decline in existing-home sales was sharper than expected, as economists had forecast a rate of 4.07 million homes.
In the last 12 months, existing-home sales have declined 1%.
“March home sales remained sluggish and below last year’s pace,” said NAR Chief Economist Dr. Lawrence Yun. “Lower consumer confidence and softer job growth continue to hold back buyers.”
The gold market is not seeing much reaction to the disappointing housing sales data. Spot gold last traded at $4,724.80 an ounce, down 0.24% on the day.
Some analysts have said that the economic data should provide some support for gold prices, as further weakness in the U.S. housing sector is expected to weigh on U.S. economic activity, which could prompt the Federal Reserve to ease interest rates, even as inflation pressures remain elevated.
Along with March’s disappointing headline number, the NAR is also revising down its sales expectations this year. The association says it now expects existing-home sales to increase 4% this year, down from the previous projection. New-home sales are now expected to remain flat, a downward revision from the prior forecast of a 5% gain. The median home price forecast remains unchanged, with prices still projected to rise 4% in 2026.
Yun said that low inventories remain a major headwind for the housing market as it is keeping prices elevated.
The inventory-to-sales ratio, or supply-to-demand ratio, is below historical norms. An additional 300,000 to 500,000 homes for sale would help bring the market closer to normal conditions and allow consumers to make purchase decisions without feeling rushed,” said Yun. “Because inventory remains limited, the median home price rose to a new record high for the month of March. That price growth has helped the typical homeowner accumulate $128,100 in housing wealth over the past six years.”
Looking at housing inventory, the report said that as of the end of March, there was a national supply of 1.36 million units, up 3% from February and representing a 4.1-month supply of unsold homes.
Meanwhile, the median price of all existing home housing types increased 1.4%, from last year.
