Housing Supply Overview
Purchases of new single-family homes increased 7.2% month-over-month as of last measure, exceeding economists’ expectations and rising to the highest level in nearly a year, according to the US Census Bureau. The limited supply of existing homes on the market, along with lower mortgage interest rates, softening sales prices, and a rise in the number of builders offering sales incentives, helped boost new home purchases, causing builder confidence to increase for the second consecutive month in February. For the 12-month period spanning March 2022 through February 2023, Pending Sales in the Western Upstate region were down 13.7 percent overall. The price range with the largest gain in sales was the $300,001 and Above range, where they increased 7.4 percent.
The overall Median Sales Price was up 12.6 percent to $271,400. The property type with the largest price gain was the Condos segment, where prices increased 25.6 percent to $220,235. The price range that tended to sell the quickest was the $100,001 to $150,000 range at 43 days; the price range that tended to sell the slowest was the $300,001 and Above range at 53 days.
Market-wide, inventory levels were up 97.6 percent. The property type that gained the most inventory was the Single Family segment, where it increased 109.2 percent. That amounts to 3.0 months supply for Single-Family homes and 3.3 months supply for Condos.
In its continued effort to curb inflation, the Federal Reserve raised its benchmark interest rate in February by a quarter-percentage point to 4.50% – 4.75%, its 8th rate hike since March of last year, when the interest rate was nearly zero. Mortgage interest rates have dipped slightly from their peak last fall, leading pending sales to increase 8.1% month-to-month as of last measure, but affordability constraints continue to limit homebuyer activity overall, with existing-home sales declining for the twelfth consecutive month, according to the National Association of Realtors® (NAR).
New Listings were down 8.9 percent to 551. Pending Sales decreased 26.7 percent to 379. Inventory grew 97.6 percent to 1,506 units.
Prices moved higher as Median Sales Price was up 2.0 percent to $261,500. Days on Market increased 34.5 percent to 74 days. Months Supply of Inventory was up 121.4 percent to 3.1 months, indicating that supply increased relative to demand.
With buyer demand down from peak levels, home price growth has continued to slow nationwide, although prices remain up from a year ago. Sellers have been increasingly cutting prices and offering sales incentives in an attempt to attract buyers, who have continued to struggle with affordability challenges this winter. The slight decline in mortgage rates earlier this year convinced some buyers to come off the sidelines, but with rates ticking up again in recent weeks, buyers are once again pulling back, causing sales activity to remain down heading into spring.
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