Existing-home sales slide slightly
Existing-home sales, hindered by a lack of supply on the market, slipped by 1% in December.
The National Association of Realtors (NAR) reported this morning that existing-homes sales decreased to a seasonally adjusted rate of 3.78 million.
On a year-over-year basis, sales declined 6.2% compared to the 4.03 million in December 2022. Total existing-home sales include completed transactions of single-family homes, townhomes, condos, and co-ops.
Single-family home sales fell slightly to an annual rate of 3.4 million in December, down 0.3% from 3.41 million in November and 6.1% from the previous year.
But healthier sales could be on the horizon, according to the NAR.
“The latest month’s sales look to be the bottom before inevitably turning higher in the new year,” said NAR Chief Economist Lawrence Yun. “Mortgage rates are meaningfully lower compared to just two months ago, and more inventory is expected to appear on the market in upcoming months.”
Freddie Mac reports that the 30-year fixed-rate mortgage averaged 6.6% as of Jan. 18. That’s down from 6.66% the prior week but up from 6.15% one year ago.
The median existing-home price for all housing types in December was $382,600, an increase of 4.4% from December 2022 ($366,500). All four U.S. regions posted price increases. The median existing single-family home price was $387,000 in December, up 4% from December 2022.
Total housing inventory registered at the end of December was 1 million units, down 11.5% from November but up 4.2% from one year ago (960,000), the NAR said. Unsold inventory sits at a 3.2-month supply at the current sales pace, down from 3.5 months in November but up from 2.9 months in December 2022.
“Despite sluggish home sales, 85 million homeowning households enjoyed further gains in housing wealth,” Yun added. “Obviously, the recent, rapid three-year rise in home prices is unsustainable. If price increases continue at the current pace, the country could accelerate into haves and have-nots. Creating a path towards homeownership for today’s renters is essential.”
Yun also noted that improvement requires economic and income growth “and, most importantly, a steady buildup of home construction.”
Here’s how existing-home sales performed on a regional basis:
- Sales in the Northeast were unchanged from November but down 9.6% to 470,000 units compared to sales in December 2022. The median price in the Northeast was $428,100, up 9.4% from the previous year.
- In the Midwest, existing-home sales retracted 4.3% from the prior month to an annual rate of 900,000 in December, down 10.9% from last year. The median price in the Midwest was $275,600, up 5.9% from December 2022.|
- Existing-home sales in the South descended 2.8% from November to an annual rate of 1.72 million in December, a decrease of 4.4% from the prior year. The median price in the South was $352,100, up 3.8% from one year ago.
- In the West, existing-home sales grew 7.8% from a month ago to an annual rate of 690,000 in December but were down 1.4% from one year before. The median price in the West was $582,000, up 4.8% from December 2022.
The National Association of Realtors will release the Pending Home Sales Index for December 2023 on Jan. 26.
