What kind of housing market are we heading into?
Housing inventory is rising throughout the country, but what about homebuyers? The team at Altos Research dug into the weekly housing market data and found several key trends.
There are about 498,000 single-family homes available for sale throughout the U.S. That’s 17% higher than the same week last year. It’s expected that we’ll continue to see home inventory increase during the spring season.
We’re still seeing new contracts increasing, meaning more sales are being completed, but last week was slightly softer than the previous week. This indicates that the recent spike in mortgage rates has kept a few homebuyers on the sidelines. However, the expectation is to see higher sales rates by the time the spring market really gets going.
The percentage of homes on the market seeing price cuts actually increased slightly week-over-week. This indicates that the current inventory isn’t seeing enough buyers to keep prices at or above their current levels. If this continues, we may see home prices continue to cool, but this is also dependent on rates staying at or above their current levels.
The median average price for an existing single-family home dipped about 1% week-over-week from $378,000 to $375,000. One week isn’t enough to make a trend. At this point its an outlier data point, but it makes sense to keep an eye on home prices.
How were new home sales in January 2024?
According to recent data, sales of newly built home ticked upwards in January 2024.
New home sales in the U.S. rose by 1.5% last month. While it was an improvement over December 2023, Wall Street was projecting numbers to rise by a little bit more. The data showed that new home sales in the South were a bit slower than projected.
Thomas Ryan, a property economist at Capital Economics, wrote, “The sharp fall in mortgage rates at the end of last year helped new home sales regain some more momentum in January. But so far, the rebound has been slower than we were anticipating. Looking ahead, we still expect further falls in mortgage borrowing costs and the historically low supply of second hand homes on the market to drive demand towards newbuilds.”
Which cities see an early rush in home sales?
Realtor.com went through sales data and detailed which housing markets see the spring housing market arrive sooner than others.
Certain cities just wake up a little earlier than others in the spring, so the housing market isn’t completely different from blooming flowers. Realtor.com compared the inventory of the 150 largest markets in March, April, and May over the past few years, and looked for any markets that see peaks earlier than others. They found quite a few markets that see activity earlier than others.
The metro area that’s projected to have an early spring housing market? Tallahassee, FL. The town known as ‘Tally’ was followed by a trio of California markets. San Jose, Los Angeles, and Oxnard are predicted to have a housing market that wakes up a bit earlier than others.
Now, you might think that sunny destinations start a bit earlier than cold weather cities, but that’s not always the case. Bridgeport, CT, New York, NY, and Philadelphia, PA all made the top ten.
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