Existing home sales take largest annual drop for 3 years

Existing home sales take largest annual drop for 3 years

Existing home sales take largest annual drop for 3 years

Sales of existing homes in Northwest Indiana grew in January as compared to a year ago, but not by as much as prices, continuing a trend in the seven counties that make up the Greater Northwest Indiana Association of Realtors.

The median existing-home price for all types of housing in January was $240,500, up 5.8% from January 2017's figure of $227,300.

Sales of existing homes across the country fell 3.2 percent in January compared to December and 4.8 percent versus last January. Rather, there simply aren't enough houses on the market, and rising prices are making it more hard for those in lower income brackets to find a home they can afford, analysts say.

In Northeast Ohio, January sales were down 1.5 percent from a year before, based on data compiled earlier this month by the Northern Ohio Regional Multiple Listing Service.

Inventory meanwhile was 1.52 million, 4.1% higher than in December but 9.5% down from January 2017. Unsold inventory is at a 3.4-month supply at the current sales pace, as against 3.6 months a year ago. "While the good news is that REALTORS® in most areas are saying buyer traffic is even stronger than the beginning of past year [according to the REALTORS® Confidence Index], sales failed to follow course and far lagged last January's pace".

The National Association of Realtors (NAR) said existing-home sales dropped 3.2 percent last month to an annual rate of 5.38 million, the slowest sales pace since September.

Even amid reports that buyer traffic is picking up, sales still lagged last January's pace. Existing homes averaged 42 days on market in January, eight days less than one year prior.

Yun said January saw a jump in new home construction, and growing homebuilder confidence.

"The gradual uptick in wages over the last few months is a promising development for the housing market, but there's risk these income gains could be offset by the recent jump in mortgage rates", Yun said.

The average 30-year fixed mortgage rate reached 4.38 percent last week, the highest in almost four years. "These two factors will hopefully lay the foundation for the building industry to meaningfully ramp up production as this year progresses".

The average commitment rate for a 30-year conventional, fixed rate mortgage rose to 4.03 percent in January from 3.95 percent in December, according to Freddie Mac.

Pent up demand due to lack of inventory could also result in some home buyers overlooking rising rates. Four percent of sales were foreclosures, and 1% were short sales.

Related news