Existing-Home Sales Fell 8.4% in January
A new report from the National Association of Realtors shows that existing-home sales decreased by 8.4% in January. Despite the drop in sales volume, the report also noted that housing affordability improved for the seventh consecutive month.
- The 8.4% month-over-month decrease in sales marks the sharpest monthly drop in nearly four years, bringing the seasonally adjusted annual rate to 3.91 million units. On a year-over-year basis, sales were down 4.4%. - NAR Chief Economist Dr. Lawrence Yun suggested that below-normal temperatures and above-normal precipitation in January may have contributed to the decline in sales. - Despite the drop in sales, the median existing-home price rose to $396,800, a 0.9% increase from January of the previous year and a new high for the month of January. This marks the 31st consecutive month of year-over-year price increases. - Total housing inventory at the end of January was 1.22 million units, which is a 3.7-month supply at the current sales pace. This is up from a 3.5-month supply in both December and a year ago. - The share of first-time homebuyers increased to 31% in January, up from 29% in December and 28% one year ago. All-cash sales accounted for 27% of transactions, a slight decrease from 28% in the prior month and 29% in January of the previous year. - Properties typically remained on the market for 46 days in January, an increase from 39 days in December and 41 days in January of the prior year. - All four major U.S. regions saw a decline in sales month-over-month and year-over-year. The West experienced the most significant drop in sales compared to the previous month. - The improved housing affordability is attributed to wage gains outpacing the growth of home prices and mortgage rates being lower than they were a year ago.
