The coronavirus pandemic has prompted business closures, layoffs, and other widespread impacts, and the housing market has not been exempt from such disruptions. According to the National Association of Realtors, pending home sales in the United States in March showed a steep decline from both the previous month and previous year.

Stay-at-home orders and other responses to the spread of COVID-19 outbreak ramped up substantially during March. The month's Pending Home Sales Index of 88.2 marked a drop of 20.8 percent from February and 16.3 percent from March 2019.

The Pending Home Sales Index measures transactions where a contract has been signed but the sale has not yet been finalized. This action typically takes place within a few months, making the index a useful short-term indicator of home sales. An index of 100 is equal to contract activity in 2001, when annual sales of existing homes fell between 5 million and 5.5 million – considered normal for the current U.S. population.

"The housing market is temporarily grappling with the coronavirus-induced shutdown, which pulled down new listings and new contracts," said Lawrence Yun, chief economist at the National Association of Realtors. "As consumers become more accustomed to social distancing protocols, and with the economy slowly and safely reopening, listings and buying activity will resume, especially given the record low mortgage rates."

Yun said the coronavirus pandemic has had a direct impact on the spring housing market, which is traditionally one of the busiest of the year. Despite his optimism about a recovery later in the year, he said an uptick in sales in the latter part of the year will be insufficient to offset losses in the second quarter. The National Association of Realtors is anticipating a 14 percent decline in home sales in 2020.

At the same time, Realtors have reported that buyers continue to peruse available properties using virtual tours and other remote tools. While transactions have slowed considerably, sellers have typically held firm on their asking prices instead of reducing them.

"Although the pandemic continues to be a major disruption in regards to the timing of home sales, home prices have been holding up well," Yun said. "In fact, due to the ongoing housing shortage, home prices are likely to squeeze out a gain in 2020 to a new record high. I project the national median home price to increase 1.3 percent for the year, though there will be local market variations and the upper-end market will likely experience a reduction in home price."

The Pending Home Sales Index in the Northeast stood at 82.3 in March, down 14.5 percent from the previous month and 11 percent from the previous year. The West had the most significant decline in pending sales, with the region's index falling 26.8 percent from February and 21.5 percent from March 2019 to 71.4.

In the Midwest, the index fell 22 percent from the previous month and 12.4 percent from the previous year to 85.6. The index of 103.7 in the South was down 19.5 percent from February and 17.8 percent from March 2019.