on friday NAR reported Lower total housing inventory levels One million In December it dropped to 970,00 units for a population of 330 million. In 2022, pre-owned home sales plummeted, falling from a peak of about 6.5 million in January to about 4 million in December.
Total inventory levels are now back to near all-time lows. In one of the most historic years for the U.S. housing market, we experienced events that few thought possible. It may sound simple, but even today some people don’t understand that a house is not like a stock. Need to find shelter.
Total housing costs for American homeowners are a fraction of their wages, and most people buy their homes immediately when they sell. Looking at housing this way makes sense for the last 40 years. His one period when this didn’t happen was from 2006 to 2011, when Americans were forced to sell, rent, or become homeless for credit. Outside of that period, everything was fine from 1982 to 2023.
If you believe people will sell and become homeless, you belong to a group of people who haven’t read housing data in decades. What’s more, sellers have pulled out earlier and sooner than in previous years, bringing the total number of existing home sales to 5,030,000 by the end of 2022.
from NAR“December was an even more difficult month for buyers, who continue to face limited inventories and high mortgage rates,” said NAR chief economist Lawrence Yun. After peaking in 2020, sales have declined significantly, so we expect sales to rebound soon.”
of federal reserve Hoping for a housing reset, we were hit by a housing recession, the most rapid drop in activity since the temporary COVID-19 moratorium. During that time, we’ve seen a decline in new listings data. However, new listing data is back in 2020 and we don’t want new listings to continue to decline this year. This is a double negative for the housing market.
Increased days on the market
One of the reasons I called the 2022 housing market wildly unhealthy is that homes flew off the shelves as soon as they were listed. There were too few days on the market. I often say that whenever the market days are at teenager’s level, nothing good happens. The inability to replicate the credit demand seen means there is not enough housing inventory available.
So the fact that we’re back on average 26 days on the market makes me happier. This is also what the Federal Reserve wants. The Federal Reserve did not like the atmosphere of home buying during COVID-9, especially non-contingent purchase agreements.
NAR Research: First-time buyers accounted for 31% of sales in December. A private investor purchased his 16% of the home. All-cash sales accounted for 28% of transactions. Defective sales were 1% of sales. Normally the property was on the market for his 26 days.
Home price growth slows
Total housing inventory didn’t rise significantly in 2022, but rising mortgage rates sharply slowed price growth and pushed it back to near record lows. The Federal Reserve wants a housing reset, and rising mortgages did the trick, cooling home prices towards the end of the year.
My 2022 price prediction was too low. That’s because mortgage rates didn’t drive prices down fast enough, as we outlined in our 2023 forecast. However, now there are more cooldowns and more days when the market grows. Both are key to my economic activity in getting housing back to normal.
NAR Research: The median resale home price across all home types was $366,900 in December, up 2.3% from December 2021 ($358,800). This is because prices have increased in all regions. This is the 130th straight month of year-over-year growth and the longest streak on record.
housing inventory
With daily growth in the market, monthly housing supply will return to more traditional levels. 2.9 Friday reports month, it’s up year-over-year 1.7 Moon. Total housing inventory is below 1 million, 970,000 unit, but it has increased from last year 880,000 unit.
The year-on-year increase in housing inventory is positive news for housing. The pre-rate crazy market is fading away in favor of a more normalized market.
NAR Research The total housing inventory at the end of December was 970,000 units, down 13.4% from November, but up 10.2% from a year ago (880,000 units). Unsold inventory put him at 2.9 months of supply at current sales pace, down from 3.3 months in November, but up from 1.7 months in December 2021.
This report matches what I expected. Existing home sales didn’t drop below 4 million as I thought they would, but still, the backward-looking report suggests we’re closer to the bottom than we were at the beginning.We talked about total housing inventory falling below 1 a million You can see it in December and January for a while.
After October, mortgage interest rates 7.37%down to 6.04% soon. The purchase requisition data also found a bouncing bottom as this data line stabilized recently.
