Mortgage News March 22, 2023
The housing market saw a decline in closed sales for February, with most contracts signed in December and January. The high 30-year fixed mortgage rates during this period, which were over 6% compared to the mid-3% range the previous year, contributed to the decrease in closed sales. However, the impact may not have been as severe as that seen for closed sales in December and January, as rates were the highest in October and November 2022, when contracts were signed for closing in those months.
The recent surge in mortgage rates is expected to have an impact on closed sales in April and May, and the median sales prices for single-family homes have also seen a decline year-over-year in several cities, including Las Vegas, Denver, San Diego, and the Northwest (Seattle Area).
Active inventory, new listings, and closed sales for several cities, including Denver, Las Vegas, Nashville, New Hampshire, the Northwest, San Diego, and Santa Clara, have also seen changes. Active listings were down 28% year-over-year in February last year but are now up 115% year-over-year. This marks a significant change from early 2022, although the year-over-year inventory increase is smaller than that seen in January, which was up 135%.
New listings were down 30% year-over-year, likely due to potential sellers being locked into their current homes with low mortgage rates. In contrast, new listings for these markets were down 19.7% year-over-year last month, which is a larger year-over-year decline and similar to that seen in December.
Sales in these markets were down 24.1% in February, which is a smaller year-over-year decline than in January. The early data suggests that the National Association of Realtors (NAR) reported sales will rebound in February. However, this will still mark the 18th consecutive month with a year-over-year decline. Overall, while the housing market has seen some changes, it remains to be seen how it will continue to perform in the coming months.
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