Real Estate Market Analysis

March 2026 Existing-Home Sales: A Regional Breakdown for Investors

National headline numbers show a pullback, but the regional picture tells a more nuanced story about where buyer demand may be building.

The National Association of Realtors’ March 2026 existing-home sales report tells a mixed story depending on where you’re looking. National headline numbers show a pullback, with sales falling 3.6% month-over-month to a seasonally adjusted annual rate of 3.98 million. But the regional picture is far more nuanced, and the year-over-year affordability improvements signal where buyer demand may be building.

The Regional Divergence Investors Should Watch

The South and West are the two regions holding up on an annual basis, both posting year-over-year sales growth (+2.2% and +1.3%, respectively), while the Northeast and Midwest both declined year-over-year (-12.2% and -3.2%).

The West tells a different story: prices there actually fell 1.3% year-over-year to $613,400, yet sales held positive.

The South remains the most active market by volume, with 1.86 million units on an annualized basis, and carries the most affordable median price among all regions at $362,600, up just 0.8% year-over-year.

Affordability Is Improving, and It’s Most Pronounced in the Sun Belt

The national Housing Affordability Index came in at 113.7 in March, down slightly from February but meaningfully above the 104.2 reading from a year ago. The Sun Belt regions are leading the affordability recovery, driven by income growth, moderating price appreciation, and the decline in mortgage rates from a year ago (6.18% in March 2026 vs. 6.65% in March 2025). Year-over-year affordability gains were strongest in the West (+12.7%) and South (+10.0%), followed by the Midwest (+5.3%) and Northeast (+4.1%).

Inventory: Still Constrained, but Gradually Loosening

Total inventory reached 1.36 million units in March, up 3.0% from February and 2.3% from a year ago, representing 4.1 months of supply. That’s an improvement from the extreme tightness seen in recent years, but NAR Chief Economist Lawrence Yun notes the market still needs an additional 300,000 to 500,000 homes to reach normal conditions.

Limited supply continues to put a floor under prices. The national median hit $408,800 in March, a new record high for the month and the 33rd consecutive month of year-over-year price gains.

While the single-family housing deficit had already persisted, since 2020 the broader structural picture reinforces why inventory remains so constrained. Since 2020, total housing starts have persistently lagged household formation. The one exception was 2021, when a pandemic-era construction boom briefly pushed supply ahead of demand. Since 2022, the gap has widened every year, reaching an estimated 4.03 million homes by the end of 2025.¹

Other Signals Worth Noting

Investor and second-home buyer activity ticked up, with that cohort representing 18% of transactions in March, up from 15% a year ago. Cash sales declined to 27% from 31% the prior month, and days on market came in at 41, faster than February’s 47 though slower than the 36-day pace from March 2025.

NAR revised its full-year outlook downward due to rising mortgage rates, now projecting 4% growth in existing-home sales for 2026 (versus the prior, higher estimate).

The Takeaway

For investors, the March data reinforces a familiar theme: the national aggregate obscures significant regional variation. The West’s price softening alongside positive sales volume, and the South’s combination of affordability and transaction activity, are the two dynamics most worth tracking in the months ahead.