Final Look at Local Housing Markets in September

Each month I track closed sales, new listings and active inventory in a sample of local markets around the country (over 40 local housing markets) in the US to get an early sense of changes in the housing market. In addition, we can look for regional differences.

After the National Association of Realtors® (NAR) releases the monthly existing home sales report, I pick up additional local market data that is reported after the NAR (and I’m adding more markets). This is the final look at local markets in September.

The big story for September was that existing home sales hit a new cycle low. Also new listings were down YoY, but less than over the Summer.

This table shows the YoY change in new listings since the start of 2023. The smaller decline is due to a combination of new listings collapsing in the 2nd half of 2022, and new listings holding up more than normal seasonally (but still historically very low).

Active Inventory in September

Here is a summary of active listings for these early reporting housing markets in September.

Inventory for these markets were down 12.1% YoY in August and are now down 9.3% YoY. It is likely inventory will be up YoY in a few months, but still at a historically low level (compared to pre-pandemic levels of inventory).

Notes for all tables:

1. New additions to table in BOLD.

2. Northwest (Seattle), Jacksonville Source: Northeast Florida Association of REALTORS®

3. Totals do not include Atlanta or Denver (included in state totals)

   

New Listings in September

And here is a table for new listings in September (some areas don’t report new listings). For these areas, new listings were down 8.5% YoY. Potential sellers that are locked into their current homes with low mortgage rates has pushed down new listings.

Last month, new listings in these markets were down 9.3% YoY. The YoY decline in new listing has been getting smaller, mostly because new listings collapsed a year ago as mortgage rates increased.

It is likely new listings will be up YoY soon. However, this is a historically low level of new listings.

Closed Sales in September

And a table of September sales.

In September, sales in these markets were down 16.5%. In August, these same markets were down 13.5% YoY Not Seasonally Adjusted (NSA). Sales in Florida were up year-over-year in September because sales were depressed last year by Hurricane Ian.

Note that closed sales in September were mostly for contracts signed in July and August. Mortgage rates, according to the Freddie Mac PMMS, averaged around 6.8% in July and 7.1% in August.

October sales will be mostly for contracts signed in August and September and mortgage rates averaged 7.2% in September. My early expectation is we will see a lower level of sales in October on a seasonally adjusted annual rate basis (SAAR) than in September.

This graph shows existing home sales by month for 2022 and 2023. The recent surge in mortgage rates to 8% will impact closed sales in November and December, and it appears that existing home sales will be down year-over-year every month in 2023.

Note that the low for sales during the housing bust was 3.30 million SAAR in July 2010, well below the 3.96 million SAAR in September 2023.

More local data coming in November for activity in October!