January Forecast and 4th Look at Local Housing Markets

Lawler forecast, Adding Austin, Boston, California, Colorado, Des Moines, Minneapolis, Rhode Island and Washington, D.C.

This is the fourth look at local markets in January. I’m tracking about 30 local housing markets in the US. Some of the 30 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.

My view is that if the housing market starts slowing, it will show up in inventory first (not yet!).

The following data is important, especially active inventory. One of the key factors for house prices is supply and tracking local inventory reports will help us understand what is happening with supply.

On a national basis, we are seeing record low inventory over the Winter. I’ll be watching to see if inventory follows the normal seasonal pattern and bottoms in February. Last year, inventory didn’t bottom until April.

Note that 30-year mortgage rates average 3.4% in January according to Freddie Mac. Now rates are around 4.0%.

Lawler: Early Read on Existing Home Sales in January

From housing economist Tom Lawler:

Based on publicly-available local realtor/MLS reports released across the country through today, I project that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 6.36 million in January, up 4.3% from December’s preliminary pace but down 4.5% from last January’s seasonally adjusted pace.

Local realtor reports, as well as reports from national inventory trackers, suggest that the YOY % decline in the inventory of existing homes for sale last month was a bit larger than that in December.

Finally, local realtor/MLS reports suggest the median existing single-family home sales price last month was up by about 14.5% from last January.

(Note:  The January NAR report will incorporate updated seasonal adjustment factors.)

CR Note: The National Association of Realtors (NAR) is scheduled to release January existing home sales tomorrow, Friday, February 18, 2022, at 10:00 AM ET. The consensus is for 6.12 million SAAR.   Take the over.

California Home Sales, Prices and Inventory in January

California doesn’t report monthly sales or inventory, but here is the press release from the California Association of Realtors® (C.A.R.): California housing market remains resilient in January despite rising interest rates, C.A.R. reports

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 444,540 in January, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. … January’s sales pace was up 3.4 percent on a monthly basis from 429,860 in December and was down 8.3 percent from a year ago, when 484,760 homes were sold on an annualized basis. The year-over-year sales decrease was the seventh straight decline and the smallest in six months.

California home prices continued to decelerate as a shift in the mix of sales toward less expensive homes and seasonal slowdown continued. The statewide median price declined to $765,580 in January, down 3.9 percent from December’s $796,580 and was up 9.4 percent from the $699,920 recorded in January 2021.

California’s Unsold Inventory Index (UII) rose in January as new active listings increased 37.2 percent from December. January’s UII was 1.8 months and 1.4 months in January 2021. The index indicates the number of months it would take to sell the supply of homes on the market at the current rate of sales.

emphasis added

Active Inventory in January

Here is a summary of active listings for these housing markets in January. Inventory was down 10.7% in January month-over-month (MoM) from December, and down 28.3% year-over-year (YoY).

Inventory almost always declines seasonally during the Winter, so the MoM decline is not a surprise. Last month, these markets were down 26.6% YoY, so the YoY decline in January is slightly larger than in December. This isn’t indicating a slowing market.

Notes for all tables:

1. New additions to table in BOLD.

2. Northwest (Seattle), North Texas (Dallas), and Santa Clara (San Jose), Jacksonville, Source: Northeast Florida Association of REALTORS®

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

   

Please share with your friends and colleagues!

New Listings in January

And here is a table for new listings in January. For these areas, new listings were down 11.4% YoY.

Last month, new listings in these markets were down 8.4% YoY.

Closed Sales in January

And a table of January sales. Sales were down 6.8% YoY, Not Seasonally Adjusted (NSA).

More local market data to come!