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Economists polled by Reuters had forecast sales increasing 2.5 per cent to a pace of 5.60 million units in March.
The housing recovery has been underpinned by falling unemployment and rising wages. The unemployment rate declined to 4.5 per cent in March to near a 10-year low.
But demand is outstripping supply. While the number of homes on the market rose 5.8 per cent to 1.83 million units last month, housing inventory was down 6.6 per cent from a year ago.
Properties typically remained on the market for 34 days in March compared to 45 days in February, the NAR said.
At March's sales pace, it would take 3.8 months to clear the stock of houses on the market, unchanged from February.
"We had a housing shortage last year and in the early parts of 2017 the housing shortage has intensified," NAR chief economist Lawrence Yun said.
Housing inventory has dropped for 22 straight months on a year-on-year basis.
With supply still tight, the median house price rose 6.8 per cent from one year ago to $236,400 in March, the 61st consecutive month of year-on-year price increases.