Lower Rates Signal Hope as Inventory Pressures Continue, Latest HouseCanary Report Shows
After months of consistent increases from the Federal Reserve, mortgage rates have finally started to decrease. Following data showing that inflation might be cooling, rates recently hit their lowest levels in more than two months, reversing the previous trend of consistent increases. In order to see the impact of lower rates on home prices, however, potential buyers and sellers will need time to adjust. That being said, the housing market remains far off pre-pandemic inventory levels, and there is potential for recent rate decreases to couple with depressed inventory and increase demand, keeping prices elevated well into 2024. The ‘sticker shock’ of high mortgage rates will continue to keep many potential buyers on the sidelines pending even further rate decreases.
While recent rate decreases have brought hopes of relief, the housing market continued to face low activity in November. Despite inventory being up 1.7% from the same period last year and up 5.8% from the year prior, inventory levels remain low from a historical perspective. Positive inflation data is having a beneficial impact on mortgage rates, but the market as a whole will continue to be constrained by inventory levels. While rates are seeing slight decreases, it is unlikely that they will fall to pre-pandemic levels in the near future. Buyers will have to come to terms with a new normal of higher-than-average mortgage rates, and 2024 purchase activity will likely remain at below average levels compared to previous years.
- For the month of November, 157,658 net new listings were placed on the market which represents a 10.9% decrease versus November 2022. Over the last 52 weeks there have been 2,460,745 net new listings placed on the market. This represents a 21.1% decrease versus the year prior. Broken out by price bins, the $0-$200k bin has accounted for 13.7% of net new listings over the last 52 weeks, the $200k-$400k bin at 38.9% of net new listings, the $400k-$600k bin at 23.4% of net new listings, the $600k-$1m bin at 15.8% of net new listings, and the $1m+ bin at 8.2% of net new listings.
- The total volume of net new listings over the last 52 weeks for the $0-$200k, $200k-$400k, $400k-$600k, $600k-$1m, and $1m+ price bins are down 21.9%, 20.2%, 23.3%, 21.3% and 17.6% compared to the year prior. For the month of November net new listing volume for the $0-$200k, $200k-$400k and $400k-$600k price bins are down 14.2%, 17.6%, and 9.5%, respectively, while the $600k-$1m and $1m+ price bin is up 3,6% and 12.1%, respectively, compared to November 2022.
- For the month of November there were 212,430 listings that went under contract nationwide which is a 1.2% decrease versus November 2022. Over the last 52 weeks, 2,584,363 properties have gone into contract. This represents a 15.5% decrease versus the year prior. Broken out by price bins, the $0-$200k bin has accounted for 14.4% of total contract volume over the last 52 weeks, the $200k-$400k bin at 39.5% of total contract volume, the $400k-$600k bin at 23.3% of total contract volume, the $600k-$1m bin at 15.3% of total contract volume, and the $1m+ bin at 7.5% of total contract volume.
- The total volume of listings going into contract over the last 52 weeks for the $0-$200k, $200k-$400k, $400k-$600k, $600k-$1m and $1m+ price bins are down 18.0%, 13.4%, 16.5%, 16.3% and 16.6% compared to the year prior. For the month of November, contract volume for the $0-$200k, $200k-$400k and $400k-$600k price bins are down 4.0%, 2.9% and 1.4% respectively, for $600k-$1m and $1m+ price bins are up 2.0% and 10.3% respectively, compared to November 2022.
- For the week ending November 24th 2023, the median price of all single-family listings in the US was $429,633 and the median closed price was $402,891. On a year-over-year basis, the median price of all single-family listings is up 3.1% and the median price of closed listings is up 6.1%. Month-over-month, the median price of single-family listings is down 1.3% and the median price of closed listings is up 0.1%.
- For the week ending November 24th 2023, the median price of all single-family rental listings in the US was $2,544. On a year-over-year basis, the median price of all single-family rental listings is up 2.5%. Month-over-month, the median price of single-family rental listings remains the same.
