January 2023 Market Reports

Housing Supply Overview

For the first time in a year, homebuilder confidence has increased, rising 4 points to 35 in January, according to the National Association of Home Builders (NAHB) / Wells Fargo Housing Market Index (HMI). Elevated sales prices, coupled with a surge in mortgage rates, caused demand for new homes to plummet in 2022, with builder sentiment declining throughout the year. The recent rise in builder optimism may be due in part to new home sales, which increased 2.3% month-to-month as of last measure, according to the U.S. Census Bureau. For the 12-month period spanning February 2022 through January 2023, Pending Sales in the Western Upstate region were down 12.3 percent overall. The price range with the largest gain in sales was the $300,001 and Above range, where they increased 9.6 percent.

The overall Median Sales Price was up 12.7 percent to $270,369. The property type with the largest price gain was the Condos segment, where prices increased 27.5 percent to $221,790. The price range that tended to sell the quickest was the $150,001 to $200,000 range at 42 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 101.5 percent. The property type that gained the most inventory was the Single Family segment, where it increased 112.4 percent. That amounts to 3.0 months supply for Single-Family homes and 3.3 months supply for Condos.

Monthly Indicators

The US housing market began the year in a state of rebalance, with many buyers and sellers remaining cautious while they wait to see where the market is headed. Nationally, pending sales rose 2.5% month-to-month, marking the first increase since May, while sales of existing homes fell 1.5% as of last measure, according to the National Association of Realtors® (NAR). Demand for housing persists, but higher mortgage interest rates have cut into housing affordability, with total home sales down 17.8% last year compared to 2021.

New Listings were up 6.5 percent to 538. Pending Sales decreased 26.5 percent to 341.

Inventory grew 101.5 percent to 1,493 units.

Prices moved lower as Median Sales Price was down 0.6 percent to $239,950. Days on Market increased 25.0 percent to 65 days. Months Supply of Inventory was up 138.5 percent to 3.1 months, indicating that supply increased relative to demand.

As sales slow, time on market is increasing, with the average home spending 26 days on market as of last measure, according to NAR. Seller concessions have made a comeback, giving buyers more time and negotiating power when shopping for a home. Although home prices remain high, mortgage rates declined steadily throughout January, falling to their lowest level since September, sparking a recent surge in mortgage demand. Lower rates should aid in affordability and may soon lead to an uptick in market activity ahead of the spring selling season.

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