NAR: Sales Up, Prices Down After 131-Month Streak
In Feb., month-to-month home sales surged 14.5% as buyers locked in lower mortgage rates, but a 0.2% price drop is the first decline in almost 11 years.
WASHINGTON – Existing-home sales reversed a 12-month slide in February, registering the largest monthly percentage increase since July 2020, according to the National Association of Realtors® (NAR).
Month-over-month sales rose in all four major U.S. regions – but they also all saw year-over-year declines.
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – climbed 14.5% from January to a seasonally adjusted annual rate of 4.58 million in February. Year-over-year, sales fell 22.6% (down from 5.92 million in February 2022).
“Conscious of changing mortgage rates, homebuyers are taking advantage of any rate declines,” says NAR Chief Economist Lawrence Yun. “Moreover, we’re seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs.”
Total housing inventory at the end of February was 980,000 units, identical to January and up 15.3% from one year ago (850,000). Unsold inventory sits at a 2.6-month supply at the current sales pace, down 10.3% from January but up from 1.7 months in February 2022.
“Inventory levels are still at historic lows,” Yun adds. “Consequently, multiple offers are returning on a good number of properties.”
February median existing home prices fell for the first time in 131 months– almost eleven years – according to NAR. The median existing-home price for all housing types was $363,000, a decline of 0.2% from February 2022 ($363,700), as prices climbed in the Midwest and South yet waned in the Northeast and West.
Properties typically remained on the market for 34 days in February, up from 33 days in January and 18 days in February 2022. Still, most homes (57%) sold in February were on the market for less than a month.
- First-time buyers were responsible for 27% of sales in February, down from 31% in January and 29% in February 2022.
- All-cash sales accounted for 28% of transactions in February, down from 29% in January but up from 25% in February 2022.
- Individual investors or second-home buyers, who make up many cash sales, purchased 18% of homes in February, up from 16% in January but down from 19% in February 2022.
- Distressed sales – foreclosures and short sales – represented 2% of sales in February, nearly identical to last month and one year ago.
According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.60% as of March 16. That’s down from 6.73% from the previous week but up from 4.16% one year ago.
Single-family and condo/co-op sales: Single-family home sales soared to a seasonally adjusted annual rate of 4.14 million in February, up 15.3% from 3.59 million in January but down 21.4% from the previous year. The median existing single-family home price was $367,500 in February, down 0.7% from February 2022.
Existing condominium and co-op sales were at a seasonally adjusted annual rate of 440,000 units in February, up from 410,000 in January but down 32.3% from one year ago. The median existing condo price was $321,000 in February, an annual increase of 2.5%.
“Owning a home provides a path to long-term financial security and is a vehicle by which to transfer wealth to future generations,” said NAR President Kenny Parcell. “Realtors deliver expert guidance, objectivity and professionalism to consumers during the complex process of purchasing a home.”
Regional breakdown: Existing-home sales in the Northeast improved 4.0% from January to an annual rate of 520,000 in February, down 25.7% from February 2022. The median price in the Northeast was $366,100, down 4.5% from the previous year.
In the Midwest, existing-home sales grew 13.5% from the previous month to an annual rate of 1.09 million in February, down 18.7% from one year ago. The median price in the Midwest was $261,200, up 5.0% from February 2022.
Existing-home sales in the South rebounded 15.9% in February from January to an annual rate of 2.11 million, a 21.3% decrease from the prior year. The median price in the South was $342,000, an increase of 2.7% from one year ago.
In the West, existing-home sales rocketed 19.4% in February from the prior month to an annual rate of 860,000, down 28.3% from the previous year. The median price in the West was $541,100, down 5.6% from February 2022.
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