WASHINGTON (February 21, 2023) – Existing-home sales fell for the twelfth straight month in January, according to the National Association of Realtors®. Month-over-month sales were mixed among the four major U.S. regions, as the South and West registered increases, while the East and Midwest experienced declines. All regions recorded year-over-year declines.
Total existing-home sales,1 https://www.nar.realtor/existing-home-sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – slid 0.7{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from December 2022 to a seasonally adjusted annual rate of 4.00 million in January. Year-over-year, sales retreated 36.9{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} (down from 6.34 million in January 2022).
“Home sales are bottoming out,” said NAR Chief Economist Lawrence Yun. “Prices vary depending on a market’s affordability, with lower-priced regions witnessing modest growth and more expensive regions experiencing declines.”
Total housing inventory2 registered at the end of January was 980,000 units, up 2.1{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from December and 15.3{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from one year ago (850,000). Unsold inventory sits at a 2.9-month supply at the current sales pace, unchanged from December but up from 1.6 months in January 2022.
“Inventory remains low, but buyers are beginning to have better negotiating power,” Yun added. “Homes sitting on the market for more than 60 days can be purchased for around 10{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} less than the original list price.”
The median existing-home price3 for all housing types in January was $359,000, an increase of 1.3{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from January 2022 ($354,300), as prices climbed in three out of four U.S. regions while falling in the West. This marks 131 consecutive months of year-over-year increases, the longest-running streak on record.
Properties typically remained on the market for 33 days in January, up from 26 days in December and 19 days in January 2022. Fifty-four percent of homes sold in January were on the market for less than a month.
First-time buyers were responsible for 31{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of sales in January, identical to December but up from 27{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in January 2022. NAR’s 2022 Profile of Home Buyers and Sellers – released in November 20224 – found that the annual share of first-time buyers was 26{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb}, the lowest since NAR began tracking the data.
All-cash sales accounted for 29{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of transactions in January, up from 28{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in December and 27{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in January 2022.
Individual investors or second-home buyers, who make up many cash sales, purchased 16{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of homes in January, unchanged from December but down from 22{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in January 2022.
Distressed sales5 – foreclosures and short sales – represented 1{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of sales in January, identical to last month and one year ago.
According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.32{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} as of February 16. That’s up from 6.12{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from the previous week and 3.92{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} one year ago.
Single-family and Condo/Co-op Sales
Single-family home sales declined to a seasonally adjusted annual rate of 3.59 million in January, down 0.8{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from 3.62 million in December and 36.1{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from one year ago. The median existing single-family home price was $363,100 in January, up 0.7{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from January 2022.
Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 410,000 units in January, unchanged from December but down 43.1{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from the previous year. The median existing condo price was $320,000 in January, an annual increase of 5.2{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb}.
“Realtors® help consumers realize the American dream of property ownership, both residential and commercial,” said NAR President Kenny Parcell, a Realtor® from Spanish Fork, Utah, and broker-owner of Equity Real Estate Utah. “A Realtor® possesses trusted expertise and a thorough understanding of local market conditions that prove valuable throughout the entire real estate transaction.”
Regional Breakdown
Existing-home sales in the Northeast retracted 3.8{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from December to an annual rate of 500,000 in January, down 35.9{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from January 2022. The median price in the Northeast was $383,000, up 0.3{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from the previous year.
In the Midwest, existing-home sales slid 5.0{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from the previous month to an annual rate of 960,000 in January, declining 33.3{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from one year ago. The median price in the Midwest was $252,300, up 2.7{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from January 2022.
Existing-home sales in the South rose 1.1{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in January from December to an annual rate of 1.82 million, a 36.6{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} decrease from the prior year. The median price in the South was $332,500, an increase of 3.4{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from one year ago.
In the West, existing-home sales elevated 2.9{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} in January to an annual rate of 720,000, down 42.4{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from the previous year. The median price in the West was $525,200, down 4.6{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} from January 2022.
The National Association of Realtors® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries. The term Realtor® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.
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For local information, please contact the local association of Realtors® for data from local multiple listing services (MLS). Local MLS data is the most accurate source of sales and price information in specific areas, although there may be differences in reporting methodology.
NOTE: NAR’s Pending Home Sales Index for January is scheduled for release on February 27, and Existing-Home Sales for February will be released on March 21. Release times are 10 a.m. Eastern.
1 Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR benchmarks home sales periodically using other sources to assess overall home sales trends, including sales not reported by MLSs.
Existing-home sales, based on closings, differ from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which account for more than 90{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of total home sales, are based on a much larger data sample – about 40{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of multiple listing service data each month – and typically are not subject to large prior-month revisions.
The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.
Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.
2 Total inventory and month’s supply data are available back through 1999, while single-family inventory and month’s supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90{171d91e9a1d50446856093950b947460c67b1ae5766d3d173ffede4594e3fbfb} of transactions and condos were measured only on a quarterly basis).
3 The median price is where half sold for more and half sold for less; medians are more typical of market conditions than average prices, which are skewed higher by a relatively small share of upper-end transactions. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if additional data is received.
The national median condo/co-op price often is higher than the median single-family home price because condos are concentrated in higher-cost housing markets. However, in a given area, single-family homes typically sell for more than condos as seen in NAR’s quarterly metro area price reports.
4 Survey results represent owner-occupants and differ from separately reported monthly findings from NAR’s Realtors® Confidence Index, which include all types of buyers. The annual study only represents primary residence purchases, and does not include investor and vacation home buyers. Results include both new and existing homes.
5 Distressed sales (foreclosures and short sales), days on market, first-time buyers, all-cash transactions and investors are from a monthly survey for the NAR’s Realtors® Confidence Index, posted at nar.realtor.
