HouseCanary Inc., a national real estate brokerage, found that in September the housing market remained sluggish, with mortgage rates hitting unprecedented levels. Despite this stagnation, closed prices have maintained a positive year-over-year trajectory. However, list prices, having peaked in June, now seem to have plateaued.
Early data from September indicated a possible uptick in year-over-year inflation, suggesting further rate hikes. As metrics like total inventory, net new listings, and new listing volume consistently decreased compared to the previous year, any added hikes would likely exacerbate the already evident market downturn. The Federal Reserve, acknowledging this trend, halted the hikes in its recent meeting but has intimated another impending hike. Adding to potential buyer woes, the restart of student loan repayments in October could further strain affordability.
"Our data reveals a decrease in net new listings by 20% compared to last year, coupled with a 12.4% drop in properties going under contract," HouseCanary's Co-Founder and CEO Jeremy Sicklick, said. "This subdued market environment, characterized by a 5% reduction in median days on market, signals a current seller's market, prompting potential buyers to continue to turn towards the rental market due to high interest rates. Furthermore, anticipated student loan payments beginning in October are expected to put additional downward pressure on demand from would-be buyers facing high purchase prices, high interest rates and less discretionary income."
September 2023 Highlights:
- Net New Listings: A total of 216,690 net new listings emerged, marking a 20.0% downturn from September 2022.
- Properties Under Contract: 248,316 properties went under contract, a decrease of 12.4% year-over-year.
- Days on Market: Median days on market for listings was 38, a 5.0% drop from last year's 40 days.
- Price Dynamics: The sale-to-list-price ratio hit 99.0%, a notable rise from the low observed in January 2023, while price cuts plummeted by 26.1% compared to 2022.
- Inventory Shifts: Total inventory shrunk by 9.6% from 2022 and 8.7% from 2021, marking a historically low inventory period. In contrast, single-family rental inventory surged, up 34.1% from 2022 and a staggering 158.1% from 2021, indicating the strong appeal of the rental market in current conditions.
