The housing craze in 2021 reached new highs as a slight increase in listings offered a silver lining for buyers trying to find a home in a competitive market and lock in low mortgage rates. But like all roller coasters, what goes up must come down.
The seasonally adjusted number of homes for sale fell 18% year-over-year in November to an all-time low, according to a new report from Redfin, a technology-focused real estate brokerage. That pushed the median selling price up 15% to $ 383,100.
November marked the 16th consecutive month of double-digit price increases, and so far in December, there is no sign of the typical seasonal slowdown in price growth that typically occurs at the end of the year. Seasonally adjusted closed home sales and new listings of homes for sale both declined from the previous year, by 6% and 9% respectively, and the average home sold 0.6% more than the previous year. price catalogue.
âI wish I had better news for homebuyers this holiday season, but in many ways the housing market is tougher than ever,â said Redfin chief economist Daryl Fairweather. âAt least buyers are benefiting from low mortgage rates. But by next year, inflation could spread to more consumer goods. So even though our forecast for the new year includes more listings and slower home price growth, buyers may feel so stuck with other spending that they have to cut their housing budgets.
Median selling prices increased year-over-year at Redfin’s 85 largest metropolitan areas. The smallest increases were recorded in Baltimore; Bridgeport, Connecticut; and Newark, New Jersey. The largest price increases were recorded in Austin, Texas (+ 31%), Phoenix (+ 27%) and North Port, Florida (+ 27%).
Seasonally adjusted home sales in November were down 6% from the previous year, a slightly smaller drop than the month before. Home sales fell in 49 of Redfin’s 85 largest metropolitan areas. The largest sales declines were seen in Nassau County, New York (-21%), Bridgeport, Connecticut (-19%) and McAllen, Texas (-17%). The biggest gains were seen in places where sales were still somewhat depressed in November 2020, including Honolulu (+ 31%), San Francisco (+ 13%) and Tulsa (11%).
Seasonally adjusted active listings, the number of all homes for sale at any time of the month, hit an all-time low in November, falling 18% year over year.
Only four of the 85 largest subways tracked by Redfin posted a year-over-year increase in seasonally adjusted active listings for homes for sale: Detroit (+ 7%), Milwaukee (+ 4%), Austin, Texas (+ 3%) and Tacoma, Washington (+ 2%). The largest year-over-year declines in active housing supply in November were recorded in Baton Rouge, Louisiana (-51%), Salt Lake City (-50%) and Sacramento, in California (-48%).
Seasonally adjusted new listings of homes for sale fell 9% in November from a year earlier, on par with the decline observed in October. New listings are down from a year ago in 57 of the 85 largest metropolitan areas. The largest declines were recorded in Baton Rouge, Louisiana (-55%), Salt Lake City (-55%) and Allentown, Pennsylvania (-52%). New listings increased the most from a year ago in Detroit (+ 20%), Pittsburgh (+ 11%) and Indianapolis (+ 9%).
The housing market became less competitive in November than in previous months as homes spent more time in the market and were less likely to sell for above the list price. The typical home sold in November went under contract in 22 days, almost a week longer than a year earlier, when homes sold in 28 days on average, but up seven days from the previous year. 15-day record in June.
In November, 44% of homes sold above the list price, down 12 percentage points from June’s record high, but up 9 percentage points from the previous year. The average sale-to-list price ratio also fell slightly in November to 100.6%, down from a record 102.6% in June but up from 99.5% a year earlier.
In addition, Redfin reported that increases in rent prices exceeded increases in mortgage payments for new home buyers in 19 of the 50 largest metropolitan areas in the United States in November.
âInflation came first for the home market for sale, and now it’s coming for the rental market,â Fairweather said. âA lot of people have been shut out of the selling market and are looking to rent instead, but this demand is driving rents up. “
She added, âAnyone who has bought a home before this year can congratulate themselves because their mortgage payments are fixed, which means their biggest recurring expense is immune to inflation. If you are looking to buy or rent now, there is nowhere to hide from inflation when it comes to housing costs. The good news is that the tight job market means now is a great time to relocate to a more affordable location. Chances are, wherever you go, you can find a new job pretty quickly.
The 10 metropolitan areas with the largest increases in rent prices – up 28% year-over-year or more – were found almost exclusively in Florida and New York. The exception is Austin, Texas, where rents have gone up 30%.
The metropolitan areas are: Miami, Fort Lauderdale, West Palm Beach, Florida, New York, Newark, New Jersey; Nassau County, New York; Nassau County, New York; New Brunswick, New Jersey; Jacksonville, Florida; Austin; and Tampa.