Buyers Search Online Despite Worst US Home Sales In 2023
Since their November low, Google searches for “homes for sale” have increased by around 50%.
Homes for sale in 2023 remain low.
Redfin claims that even if house sales are sluggish to start the new year, the rise in the number of people shopping for properties online is encouraging.
Since April 2020, the average single-family house in America has taken longer to sell than ever, and the number of pending transactions is at an all-time low.
On the other hand, there is an increase in online house searches and tour requests.
Sales might result from those early indications of demand, particularly when mortgage rates decline from their high and inflation cools.
Recent research from the technology-powered real estate firm Redfin claims that US home sales have slowed since the housing market almost collapsed at the start of the epidemic.
In December 2022, the average single-family home sold stayed on the market for 44 days – a record longest since April 2020.
Pending home sales decreased by 32% annually to their lowest level since 2014.
Mortgage purchase applications also fell to their lowest level since that year.
The traditional Christmas holiday slowdown was made worse by the high mortgage rates and severe winter weather at the beginning of the year.
Google searches for “homes for sale” are increasing, indicating that early-stage demand is rising.
Redfin’s Homebuyer Demand Index measures data from Redfin agents’ records of tour requests and other buying services, which rose by 6% over the previous month.
The economy is showing signs of stabilization, with inflation dropping in December for the sixth consecutive month as pay growth slows -these factors might encourage buyers.
The latest Consumer Price Index (CPI) report reveals that the worst inflation is behind us as we head into 2023.
That means the Feds will likely continue moderating its interest rate hikes, which should lead to a steady reduction in mortgage rates.
As more people begin their property searches online, lowering home prices may tempt some homebuyers back in the coming months.
The uptick in house hunters initiating home searches online indicates they can turn into buyers with monthly mortgage payments significantly lower than their peaks.
The recent inflation and employment numbers reduce the likelihood of a recession.
Home Prices Across US Metros
In 20 of the 50 US metro areas with the highest population, home prices decreased year over year.
In the first week of January 2023, typical US homes sold for $351,250 – up 0.8% from a year ago but down around 10% from the peak in June 2022.
Home prices fell 2.5% nationwide in November due to the recent slowdown.
With price growth registering negative year-over-year readings in the second quarter of 2023, house prices are projected to deviate even further from that high point in 2023.
US Home Sale Prices Fell Year-Over-Year (YOY)
These are the 11 metros:
- San Francisco, CA 10.6%
- Seattle, WA 5%
- San Jose, TX 4.9%
- Austin, TX 4%
- Detroit 3.8%
- Phoenix 3.7%
- Oakland, CA 3.4%
- Boston, MA 3%
- Los Angeles, CA 3%
- Sacramento, CA 3%
- San Diego, CA 2.6%
- Chicago, IL 2.5%
2% or less
- Portland, OR
- Anaheim, CA
- Riverside, CA
- Newark, NJ
- New York, NY
- Pittsburgh, PA
- Las Vegas, NV
- Washington, DC
Since 2015, this has been the most significant YOY price decrease in San Francisco, Seattle, Phoenix, Chicago, Boston, Portland, and San Diego.
Leading Signs Of US Home Sales
30-year mortgage rates dropped to 6.33% from the daily average of 6.15%.
Mortgage-purchase applications fell by 1%, reaching their lowest level since 2014, and applications for purchases decreased by 44% from the previous year.
US Home Sales For Over 400 Metro Areas
Unless otherwise stated, all information refers to the four weeks that ended on January 8.
The weekly home market statistics from Redfin date back to 2015.
Median Selling Price of Homes
$351,250, an increase of 0.8%
Newly Listed Properties
$352,150, an increase of 3.9%
At the Current Mortgage Rate of 6.33%
A typical monthly mortgage payment is $2,263, down $244 from October’s peak.
Monthly mortgage payments have increased by 32.7% since last year.
The lowest level ever recorded for pending home sales was 31.7% year over year – marking the 12th straight quarter in which they fell more than 30%.
Pending Sales Decreased Highest among the 50 most populous US metros with new home listings.
Las Vegas (- 61.9% YoY)
Jacksonville, FL (-57.4%)
Austin, TX (-55.3%)
Homes On Market Median time
Current: 44 days
May 2022: 18 days
Percentage of Homes Sold Above Final List Price
May 2022: 40%
Average Price Drop
In December 2022: 5.7%
Average Sale To List Price Ratio
In 2022: 100.1%
Redfin has the full report and charts if you are interested to read more.
If you are looking to invest in a Flip, Rental, or Airbnb, you should go where the people need housing.
So what are you waiting for?
Investing In Real Estate For Beginners
For newbies, the advantages of investing in real estate can be exciting.
You can be tempted to purchase a property you find online.
Successful investors know that solid US home sales take time.
You will need to research to find good investment properties for sale and evaluate these for specific criteria to find the best investment.
You can start by searching for properties with top real estate listing sites like Zillow, Realtor.com, Trulia, Foreclosure.com. and others.
Or you can join our investors and partners in building wealth and securing their future through intelligent investments with a hands-off approach – Noble Sky International can help you start your real estate investment journey during a recession.
You can schedule a 15- minute consultation call with us to learn more.
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