Heading into 2023, people thought housing inventory would skyrocket, home prices would collapse, and the housing market of 2008 would be revisited. We created this weekly tracker for the end of 2022 to give people a live weekly outlook on all the factors driving the housing market and which ones to follow. If you’re reading this tracker, you should now understand why the dynamics of the housing market changed on November 9, 2022, and be prepared for what happens next.
Looking back to 2023, the inventory story was a big surprise even though mortgage rates were heading towards 8%, as the data below shows. Traditionally, Tracker articles have covered purchase request data and mortgage rates as well as inventory, but purchase request data is not available during the holiday week, and there was nothing major happening in the bond market last week. So today’s tracker focuses on 2023, inventory data, and how this year was different from his 2022.
Weekly housing inventory data
One of the mistakes I made in 2023 was thinking that if mortgage rates rose above 7.25%, we would have several weeks of inventory increasing between 11,000 and 17,000 homes per week. This never happened in 2023, despite rising mortgage rates. I knew home sales in 2023 wouldn’t plummet like they did in 2022, so I adjusted my forecast to account for a more stable sales market, but even with that adjustment, I didn’t expect to see as much as I expected. We were unable to achieve our weekly inventory growth levels. When the mortgage interest rate exceeds 7.25%.
I recently found out about this and other crazy data lines, Altos Researchon him Top of Mind Podcast.
- According to last year, Altos Research, the seasonal peak in housing inventory was October 28th. This year’s peak was November 17th.
- Weekly inventory changes (December 22nd to 29th): inventory has fallen 528,601 to 513,240
- Same week last year (December 23rd to 30th): Inventory decreased compared to the previous year 508,777 to 490,809
- The bottom price of inventory in 2022 is 240,194
- Inventory peak in 2023 is 569,898
- Check out this week’s active list for context. 2015 was 1,013,245
New listing data
One of the positive stories about housing stock that I was looking forward to in 2023 was that new property data did not cause new prices to fall further, which bodes well for the housing market in 2024. It will be. I believe that most home sellers are also home buyers, so once mortgage rates exceed 6% in 2022, new listings will create a new low and housing demand will fall off a cliff. added another layer. The speed of the collapse in home sales in 2022 was historic, but in 2023, no matter how high mortgage rates rise, new listing data will not produce a new drop.
New listing data is forming a bottom, and as mentioned above, we expected some growth in the second half of this year. CNBC months ago.
What we hope to see in 2024 is new listing data that will increase during the spring season. As you can see from the graph below, there is a huge difference between the 2023 data and his 2021 and 2022 data. Achieving a more functional marketplace requires new listing data to grow to that level. This is one thing I’m rooting for him to do in 2024.
This is last week’s new listing data for the past few years. Since it’s the end of the year, the numbers are similar. But in recent years, spring inventory has been very different. This means that seasonal quantities always increase.
- 2023: 24,394
- 2022: 19,128
- 2021: 21,736
To all those who wondered if post-2008 housing would be a repeat, or worse. Be sure to read and remember this new list data row. New listing data for 2021, 2022, and 2023 remained at record low levels. The average number of new listings in the last week over the past three years is 21,753 New list. This number for that week in 2008 was 249,655. That’s 10x more lists!
As a result, even during the peak period for new listings, inventories were significantly lower than their seasonal lows in 2008 (the last week of the year). Reading is good and you can see why I stress that disinformation campaigns are always carried out by crazy groups. New listing data from 2008 to 2011 is 250,000 and 400,000Over the past 12 years, there has been no data to show that these two markets are similar.
Price reduction rate data
This is one piece of data that can confuse people. That’s because people don’t know that in a given year, about a third of all homes are discounted before they are sold. The number of homes discounted should increase as demand declines and inventory increases, but the only bleak data line for 2023 is that prices will decline even as mortgage rates rise to 8%. The number of homes that were built was less than 4%. View your 2022 levels weekly. With home prices and interest rates rising at the same time, I’m surprised there hasn’t been any downward movement. However, this indicates that the second half of 2022 was an unusual situation with a historic sales collapse. If rates fall and demand increases, this will become an important data line in 2024.
This week’s price drop rates over the past few years:
- 2023: 35%
- 2022: 38%
- 2021: twenty four%
The housing market in 2023 was tumultuous, but nothing compares to 2022, which was the craziest housing year on record. Looking ahead to 2024, we need to focus on housing in a more normal environment and look at labor data to see if that changes inventory conditions.
Next week is jobs week, so four labor statistics that could move mortgage rates will be released. Other than that, it’s time to look to 2024. My His 2024 Housing Forecast and Forecast Podcast will both be released on Monday.