Sales of previously owned homes fell to a seasonally adjusted annual rate of 5.53 million units from an upwardly revised 5.86 million unit pace in February, NAR said.
The sales pace fell short of expectations of analysts polled by Reuters, who, on average, had expected a 5.77 million unit clip. It was the largest drop since a fall of 8.8 percent in June of last year.
"It's due to the weak economy, to the uncertainty surrounding the war and to poor weather," said David Lereah, chief economist for the Realtors.
The median existing home sales price in March was $163,100, up 6.5 percent from the same month the prior year.
Inventories rose to five months' supply of homes on the market from 4.4 months in February.
Consumer spending and the strong housing market have been two mainstays of the U.S. economic recovery with business spending yet to pick up appreciably. Droves of homebuyers were lured by mortgage rates at levels not seen since the early 1960s.