Nationally, existing-home sales fell for the 12th straight month in January, according to the National Association of Realtors®. Sales from month to month were varied among the four major U.S. regions, with the South and West recording increases and the East and Midwest registering drops. Year-over-year, every region saw a decrease. The median existing-home price for all housing types in January was $359,000, an increase of 1.3% from January 2022 ($354,300). This is a record-breaking streak of 131 months of year-over-year increases.
On Friday, the US Census Bureau and the Department of Housing and Urban Development released data that showed a 7.2% increase in the sales of new single-family houses for the month of January. This adjusted annual rate stands at 670,000. January saw new home sales continuing to rise after a long period of decline, reaching more than 600,000 units for two months in a row.
“Home sales are bottoming out,” NAR Chief Economist Lawrence Yun said in a statement. “Inventory remains low, but buyers are beginning to have better negotiating power. Prices vary depending on a market’s affordability, with lower-priced regions witnessing modest growth and more expensive regions experiencing declines.”
The typical home sold last month was on the market for 51 days—the highest level since February 2020. In January 2022, that had increased to 27 days. The length of time it is taking for homes to be sold has increased due to the decrease in potential buyers. In January, 42.1% of offers written by Redfin agents were in a bidding war, the lowest rate since April 2020. The percentage decreased from 43.1% in the last month and 68% in the last year.
By the end of January, there were an estimated 439,000 single-family homes on the market, amounting to a 7.9 month supply at the current rate of sales. This is down from an 8.7 month supply in December but 39 percent higher than the 5,7 month inventory a year earlier.
Last week, applications for home purchases fell to a 25-year low as mortgage rates rose, due to the belief that the Federal Reserve will have to increase rates in order to counter inflation. The 30-year-fixed mortgage rate has risen to an average of 6.5%, up from 6.27% in January and 3% prior to that.
0. “Houses are staying on the market longer as home sales cool” MLive.com, 25 Feb. 2023, https://www.mlive.com/public-interest/2023/02/houses-are-staying-on-the-market-longer-as-home-sales-cool.html
1. “Existing-Home Sales Descended 0.7% in January” National Association of Realtors, 21 Feb. 2023, https://www.nar.realtor/newsroom/existing-home-sales-descended-0-7-in-january
2. “Home Sales Continue to Slow” Barron's, 21 Feb. 2023, https://www.barrons.com/articles/home-sales-continue-to-slow-but-the-bottom-could-be-near-bf6ec11a
3. “US: New Home Sales rise by 7.2% in January vs 2.5% expected” FXStreet, 24 Feb. 2023, https://www.fxstreet.com/news/us-new-home-sales-rise-by-72-in-january-vs-25-expected-202302241539
4. “New Home Sales Hit 10-Month High, Despite Some Regional Decline” Mortgage News Daily, 24 Feb. 2023, https://www.mortgagenewsdaily.com/news/02242023-new-home-sales
5. “Home sales sank in January for the 12th straight month” KTVZ, 21 Feb. 2023, https://ktvz.com/money/cnn-business-consumer/2023/02/21/home-sales-sank-in-january-for-the-12th-straight-month/
6. “Homes in the U.S. Are Taking Longer to Sell Now Than at Any Point During the Peak of the Pandemic” Mansion Global, 24 Feb. 2023, https://www.mansionglobal.com/articles/homes-in-the-u-s-are-taking-longer-to-sell-now-than-at-any-point-during-the-peak-of-the-pandemic-cc497fb0
7. “High Housing Costs, Low Supply Hamper Market Recovery In January” Forbes, 25 Feb. 2023, https://www.forbes.com/sites/brendarichardson/2023/02/25/high-housing-costs-low-supply-hamper-market-recovery-in-january
8. “U.S. new home beat expectations in January, gold price edges up from daily lows” Kitco NEWS, 24 Feb. 2023, https://www.kitco.com/news/2023-02-24/U-S-new-home-beat-expectations-in-January-gold-price-edges-up-from-daily-lows.html
9. “East Texas experts discuss reasons home sales dropped for 12th straight month” KTRE, 23 Feb. 2023, https://www.ktre.com/2023/02/23/east-texas-realtors-explain-reason-home-sales-dropped-12th-straight-month