Skip to main content

Existing home sales fell for the 11th consecutive month in December, hitting the slowest pace since November 2010


Sales of previously owned homes dropped 1.5% in December from the previous month, according to the National Association of Realtors.

Sales ended the year at a seasonally adjusted, annualized pace of 4.02 million units, which was 34% lower than December 2021. It is the slowest pace since November 2010, when the nation was struggling through a housing crisis brought on by faulty subprime mortgages.

Total sales for the year were down 17.8% from 2021.

Home sales have now fallen for 11 straight months, due to much higher mortgage rates, which began rising last spring and had more than doubled by fall. Sky-high prices, driven by high demand during the first years of the pandemic, weakened affordability even further and caused supply to fall sharply.

“December was another difficult month for buyers, who continue to face limited inventory and high mortgage rates,” said Lawrence Yun, chief economist for the Realtors. “However, expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year.”

Mortgage rates have fallen a full percentage point since their high last October, but they are still roughly double what they were one year ago.

At the end of December, total housing inventory fell 13.4% from November to 970,000 units. It was, however, up 10.2% from the previous December. Unsold inventory is at a 2.9-month supply at the current sales pace, down from 3.3 months in November but up from 1.7 months in December 2021.

Low supply continues to support prices to some extent, but the gains are shrinking compared with a year ago. The median price of an existing home sold in December was $366,900, up 2.3% from the year before. It is still the highest price recorded for December, but annual price gains had been in the double digits last summer.

“Markets in roughly half of the country are likely to offer potential buyers discounted prices compared to last year,” added Yun.

The trouble, however, is that sellers are not entering the market, given falling prices and weaker demand. The total inventory is higher than a year ago because homes are sitting on the market longer. New listings in January are down year over year.

“Evaporating demand has ended the strong sellers market of the past several years, and still-falling home sales tell us that many buyers are still not able to afford a purchase or not yet convinced that the market is tilted sufficiently in their favor to move forward. The housing market is entering “nobody’s market” territory as buyers and sellers remain largely in a stalemate,” said Danielle Hale, chief economist for Realtor.com.

First-time buyers continue to struggle in today’s market, making up just 31% of December sales. While this is up from 30% in December of last year, it is far off the historical norm of 40%.

The market continues to slow, with homes sitting on the market an average 26 days, up from 24 days in November and 19 days in December 2021.

All-cash sales rose to 28% of transactions from 23% the year before and investors made up 16% of sales, slightly down from 17% the year before.

While sales are down in all price categories, they are falling most sharply on the higher end. Sales of homes priced above $1 million were down 45% year over year, compared with sales of homes priced between $250,000 and $500,000, which were down 34%. Yun suggested that weakness on the higher end may be due to volatility in the stock market.

Comments

Popular posts from this blog

Update: First Responder Credit Unions Academy (FRCUA) Udates

In an ongoing effort to keep your FRCUA education current, modules are continually updated to reflect current NCUA and other regulatory agency requirements. As an example, BSA 26 now includes  Artificial Intelligence and BSA,  Elder Financial Exploitation,  Pig Butchering & BSA, and Executive Order –  Free and Fair Banking.

Mortgage Rates Tick Down

MCLEAN, Va.--Mortgage rates moved slightly lower this week, with the 30-year fixed-rate mortgage averaging 6.56%, Freddie Mac reported. “Mortgage rates are at a 10-month low,” said Sam Khater, Freddie Mac’s chief economist. “Purchase demand continues to rise on the back of lower rates and solid economic growth. Though many potential homebuyers still face affordability challenges, consistently lower rates may provide them with the impetus to enter the market.” The 30-year FRM averaged 6.56% as of Aug. 28, down from last week when it averaged 6.58%. A year ago at this time, the 30-year FRM averaged 6.35%. The 15-year FRM averaged 5.69%, unchanged from last week. A year ago at this time, the 15-year FRM averaged 5.51%, Freddie Mac said. ____________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board

SIGN UP FOR YOUR CUSTOM HEALTH INSURANCE SOLUTION TODAY

 https://bizu65.allstatehealth.com/?password=demo ____________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board

Many CUs Likely to Face New Operating Challenges "Michael Moebs"

04/08/2024 09:04 pm By Ray Birch LAKE FOREST, Ill.—The trend lines don’t lie: Financial institutions charging high overdraft fees will likely face operating challenges in the near future and may even be forced to merge if they don’t follow the market trend of lowering their OD charge. Michael Moebs, economist and chairman of Moebs $ervices, is offering that forecast following his company’s new overdraft study, which has found overall net OD revenue for 2023 was down 5.7%, with banks dipping by 8.1% to $31.4 billion, thrifts falling by 28.6%. and credit unions actually increasing net revenue 2.2%. The study further reveals the m...

Wendelville Fire Chief Andrew Pilecki re-elected to FASNY board

Andrew Pilecki, the current fire chief of Wendelville Volunteer Fire Company, has been re-elected to the board of directors of the Firefighters Association of the State of New York. Pilecki has been a member of the fire service for more than four decades, including the past 22 years as a responder with the Wendelville company. Previously he was an active member of Columbia Hook and Ladder Co. He’s also a former assistant director of emergency management for the City of North Tonawanda. FASNY directors serve five-year terms of office. During his first term, Pilecki was instrumental in supporting the association’s pandemic response, championed fire company recruitment and retention efforts, and worked to amplify the needs of Western New York’s volunteer fire service at the state level, according to FASNY. “I’m honored to be re-elected and to continue advocating for the men and women who volunteer their time, risk their safety and serve their communities across the state,” Pilecki said. “...