Rising inflation, soaring home prices, and increased mortgage interest rates have combined to cause a slowdown in the U.S. housing market. To help quell inflation, which reached 8.6% as of last measure in May, the Federal Reserve raised interest rates by three quarters of a percentage point in June, the largest interest rate hike since 1994. Higher prices, coupled with 30-year fixed mortgage rates approaching 6%, have exacerbated affordability challenges and rapidly cooled demand, with home sales and mortgage applications falling sharply from a year ago.
New Listings were up 5.7 percent to 782. Pending Sales decreased 35.4 percent to 371. Inventory grew 74.9 percent to 1,403 units.
Prices moved higher as Median Sales Price was up 14.9 percent to $278,000. Days on Market decreased 22.0 percent to 39 days. Months Supply of Inventory was up 92.9 percent to 2.7 months, indicating that supply increased relative to demand.
With monthly mortgage payments up more than 50% compared to this time last year, the rising costs of homeownership have sidelined many prospective buyers. Nationally, the median sales price of existing homes recently exceeded $400,000 for the first time ever, a 15% increase from the same period a year ago, according to the National Association of REALTORS®. As existing home sales continue to soften nationwide, housing supply is slowly improving, with inventory up for the second straight month. In time, price growth is expected to moderate as supply grows; for now, however, inventory remains low, and buyers are feeling the squeeze of higher prices all around.
Housing Supply Overview
Record-high home prices and surging mortgage interest rates are taking their toll on America’s homebuilders, with builder confidence falling for the sixth consecutive month in June and dropping to its lowest level in two years, according to the National Association of Home Builders (NAHB). Buyer traffic is down, and as construction costs increase and housing affordability declines, construction on new homes is slowing, reflecting concerns among builders about current and future sales of new single family homes in the months ahead. For the 12-month period spanning July 2021 through June 2022, Pending Sales in the Western Upstate region were down 6.4 percent overall. The price range with the largest gain in sales was the $300,001 and Above range, where they increased 10.9 percent.
The overall Median Sales Price was up 13.3 percent to $255,000. The property type with the largest price gain was the Condos segment, where prices increased 24.2 percent to $202,989. The price range that tended to sell the quickest was the $100,000 and Below range at 39 days; the price range that tended to sell the slowest was the $300,001 and Above range at 49 days.
Market-wide, inventory levels were up 74.9 percent. The property type that gained the most inventory was the Condos segment, where it increased 87.3 percent. That amounts to 2.6 months supply for Single-Family homes and 3.2 months supply for Condos.
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