Existing-Home Sales Fall for 12th Straight Month, Prices Increase in 3 of 4 US Regions

Nationally, existing-home sales fell for the 12th straight month in January, according to the National Association of Realtors®.[0] Mixed results were seen when comparing month-over-month sales among the four major U.S. regions, with the South and West showing growth, and the East and Midwest experiencing decreases.[1] Year-over-year, all regions showed decreases.[1] Sales of new homes were up 7.2% in January from December, but fell 19.4% from a year ago, according to a joint report from the US Department of Housing and Urban Development and the US Census Bureau.[2]

The median existing-home price for all housing types in January was $359,000, an increase of 1.3% from January 2022 ($354,300), as prices climbed in three out of four U.S. regions while falling in the West. A record-breaking streak of 131 months of year-over-year increases has been achieved.[1] In January, properties stayed on the market an average of 33 days, an increase from 26 days in December and 19 days in January of the previous year.[3] In January, 54% of homes sold had been on the market for less than a month.[3]

The typical home stayed on the market for 51 days—the highest level since February 2020.[4] January 2022 saw a rise to 27 days from the previous month.[5] The duration of time homes are on the market has increased due to a decrease in prospective buyers vying for them.[5] In January, 42.1% of home offers written by Redfin agents encountered a bidding war, which was the lowest rate since April 2020.[5] The figure has decreased from 43.1% in the preceding month and 68% in the same month of[5] Austin and Tampa, two “pandemic boom towns”, experienced some of the biggest drops in competition due to the fact that a number of potential homebuyers have been unable to afford the prices.[5]

With mortgage rates easing off their highs of the past year at the start of 2023, some buyers have returned to the market, but home prices remain high.[6] Last month, the median sales price of homes sold across the state was $325,000, representing an 11.2% jump compared to the January 2022 figure, yet a drop from the $330,000 median of December. Applications for home-buying dropped to the most reduced rate since 1995 last week, due to mortgage rates rising in anticipation of the Federal Reserve having to raise interest rates as a means of controlling inflation.[5] The 30-year-fixed mortgage rate has increased to an average of 6.5%, up from 6.[7]

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. “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

3. “US Sales of Previously Owned Homes Decline for a 12th Month” BNN Bloomberg, 21 Feb. 2023, https://www.bnnbloomberg.ca/us-sales-of-previously-owned-homes-decline-for-a-12th-month-1.1886371

4. “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

5. “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

6. “New home sales rise as prices drop in January” CNN, 24 Feb. 2023, https://www.cnn.com/2023/02/24/homes/new-home-sales-january/index.html

7. “Home sales sink for a TWELFTH straight month as mortgage rates remain stubbornly high” Daily Mail, 22 Feb. 2023, https://www.dailymail.co.uk/news/article-11777961/Home-sales-sink-12th-straight-month-mortgage-rates-remain-stubbornly-high.html