Sales of existing homes fell drastically in January, with the National Association of Realtors (NAR) reporting a year-over-year decrease of 36.9%. This marked the twelfth consecutive month of declines, and the biggest drop since 2010. The median existing-home price for all housing types was $359,000, an increase of 1.3% from the same month in 2022.
The Mortgage Bankers Association (MBA) reported a 0.9% increase in the Purchasers Affordability Index (PAPI) to 160.9 in January from 159.5 in December, but it is still 6.3 points down from the series high in October 2022. The average rate for a 30-year fixed-rate mortgage increased to 6.32% for the week ending Feb. 16, according to Freddie Mac's Primary Mortgage Market Survey. One year ago, the rate was 3.92%.
Total housing inventory registered at the end of January was 980,000 units, up 2.1% from December and 15.3% from one year ago (850,000). The amount of unsold inventory is equivalent to 2.9 months' worth of sales at the present rate, the same as in December but higher than the 1.6 months in January 2022. In January, first-time buyers accounted for 31% of sales, which was the same as December but higher than the 27% seen in January 2022. The rate of condominium and co-op sales for January remained the same as December's, but was 43% lower than in January of the previous year, with a seasonally adjusted annual rate of 410,000 units. In January, the median price of existing condos was $320,000, representing a 5.2% yearly increase.
The median and average prices of homes sold during the month were $427,500 and $474,400 respectively. This marked a decrease from the sales prices in January 2022, which were $430,500 and $501,200, respectively.
The inventory of homes to buy remains historically low, but the number of homes increased a bit in January, according to NAR, rising 2.1% from December and 15.3% from one year ago. Falling mortgage rates in the new year provided encouragement and incentive for buyers to return to the market.
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