Existing home sales fell slightly in January following a much larger decline in December. Regionally, only the Northeast saw an increase in sales, however prices continued to climb nationwide. The pace of sales was slower than it was in December, and slower than a year ago. Inventory increased both month-over-month and year-over-year, a good sign for buyers.
January existing home sales fell 1.2 percent from December, and were 8.5 percent lower than January 2018, according to the National Association of Realtors® (NAR) January Existing Home Sales Report, released February 21st.
Inventory increased from December to January, as well as year-over-year. At the current sales pace, the supply of unsold inventory was 3.9 months, up from 3.4 months a year ago.
Home prices continued to increase year-over-year. The median price of existing homes sold in January was $247,500, an increase of 2.8 percent from January 2018 ($240,800). We’ve now reached 83 consecutive months of year-over-year increases.
Days on the market (DOM) were up from December, moving from 46 to 49. A year ago, homes typically stayed on the market for 42 days, so the sales pace is also slower year-over-year.
According to NAR chief economist Lawrence Yun, “Existing home sales in January were weak compared to historical norms; however, they are likely to have reached a cyclical low. Moderating home prices combined with gains in household income will boost housing affordability, bringing more buyers to the market in the coming months.”
Regions: Sales up in the Northeast. The Northeast was the lone bright spot for sales growth. Comparing January to December, sales increased 2.9 percent in the Northeast, while falling 1.0 percent in the South, 2.5 percent in the Midwest, and 2.9 percent in the West. The West led year-over-year price increases at 2.9 percent, followed by the South at 2.5 percent, the Midwest at 1.4 percent, and the Northeast at 0.4 percent. Midland, TX took the top spot on the hottest metro areas list (measured by days on the market/listing views per property). The rest of the January Top 10 were Chico, CA, San Francisco-Oakland-Hayward, CA, Fort Wayne, IN, Colorado Springs, CO, Sacramento-Roseville-Arden-Arcade CA, Yuba City, CA, Columbus, OH, Spokane-Spokane Valley, WA and Odessa, TX. Many of the same metro areas show up month after month, but the Spokane market is new, as are Chico and Yuba City, CA.
Inventory increases favor buyers. Slower sales and higher inventory are positives for buyers as we start to move toward spring. This is a good time to talk to a mortgage loan originator if you are planning to buy a home this year. Don’t wait until the warmer weather arrives and the market heats up, too. Are you are selling and planning to buy another home? It’s a good idea to get your financing organized well in advance. If you’re in a hot market, you could go under contract quickly and then be rushing to arrange financing for your next home. First Choice Loan Services Inc. mortgage loan originators are ready to help you now.