January 2023 Housing Market Trends Report – Realtor.com News

According to Realtor.com®’s January housing data, the number of homes for sale is continuing to grow compared to last year as time on market slows but home inventory is still below pre-pandemic levels. Larger annual declines seen previously in newly listed homes and pending home listings have started to moderate, and the decline in the median home list price growth rate has also moderated, potentially signaling lower but stabilizing housing market activity. For buyers, a slower pace of home sales and more inventory provide more opportunities to find their ideal home, but prices in most areas across the country are still higher than last year and interest rates continue to cut into home affordability. For sellers, stabilizing price growth could mean more certainty going forward, but market activity remains low due to affordability challenges. 
January Saw a Moderate Decline in Newly Listed and Pending Home Listings
There were 65.5% more homes for sale in January compared to the same time in 2022. This means that there were 248,000 more homes available to buy this past month compared to one year ago. While the number of homes for sale is increasing, it is still 43.2% lower than it was before the pandemic in 2017 to 2019. This means that there are still fewer homes available to buy on a typical day than there were a few years ago.
For Sale Home Inventory Count
The total number of homes for sale, including homes that are under contract but not yet sold, increased by 13.1% compared to last year. Growth accelerated from last month’s 6.0% growth rate because homes are spending more time on the market, but the growth rate in the total number of homes for sale remains lower than active inventory because there are still fewer homes under contract (pending listings) than there were last year.   
Total For Sale Home Inventory Count
The number of homes under contract (pending listings) declined by 31.9% compared to the same time last year. This is lower than December’s 36.8% decline, which could mean that the housing market is starting to stabilize at a relatively low level of existing home sales activity. However, this could change if the direction of inflation and mortgage rates changes in the months to come. While mortgage rates are down from October and November 2022, higher rates and home prices compared to January of last year have increased the monthly cost of financing 80% of the typical home by nearly $650 (+49.6%) compared to a year ago. This far outpaces recent rent growth (+3.2%) and inflation (+6.5%).
Pending For Sale Home Inventory Count
In January, the number of homes newly-listed for sale declined by 5.4% compared to the same time last year. This is a much lower rate of decline than last month’s 21.0% decrease and November’s 17.2% decrease. However, new listings remain 25.0% below pre-pandemic 2017 to 2019 levels. In December, home selling sentiment declined and remained well below last year’s levels. Fannie Mae’s Home Purchase Sentiment Index (HPSI) revealed that the net share of respondents saying now is a good time to sell decreased by 3 percentage points compared to the previous month and declined by 25 percentage points compared to the prior year. 
Newly Listed Home Count
The number of homes for sale in the 50 largest metro areas in the U.S. has increased by 87.0% compared to last year. This is more than the national average. However, inventory in this group of metro areas as a whole is still 27.3% below pre-pandemic levels. 
The Southern region has seen the most growth in the number of homes for sale, with a 125.3% increase compared to last January. However, home inventory in the South is still 24.7% below pre-pandemic levels. The West region has seen the second-most growth, with a 114.3% increase compared to last year. Inventory in the West is only 16.0% below pre-pandemic levels. The Midwest and Northeast regions have seen slower growth, with 36.2% and 23.3% increases over last January, respectively. Inventory in the Midwest is still 38.2% below pre-pandemic levels, and it is 31.3% below pre-pandemic levels in the Northeast. 
In January, the South saw newly listed homes increase by 5.4% compared to the previous year, while they declined by 20.6% in the West, 11.5% in the Midwest, and 8.2% in the Northeast. While the South saw more new listings than last year in January, newly listed homes are still 15.6% below pre-pandemic levels in this region.
Inventory increased in 49 out of 50 of the largest metros compared to last year. Metros which saw the most inventory growth include Nashville (+303.5%), Austin (+260.4%), and Raleigh (+254.8). The only metro to see inventory decline on a year-over-year basis was Hartford (-8.0%).
In January, 12 metros saw the number of newly listed homes increase compared to last year, up from only two the month before. All twelve markets were located in the South, with Raleigh (+49.0%), Nashville (+45.3%) and Austin (+24.9%) having the greatest growth rates. Markets which reported large yearly declines in newly listed homes were mostly in the West and included San Jose (-33.9%), Sacramento (-33.9%), and San Francisco (-31.0%). 
West Sees Slower Pace of Home Sales Compared to Pre-Pandemic Period
The typical home spent 75 days on the market this January which is 13 days longer than the same time last year. Slower inventory turnover is primarily fueling the growth in actively listed homes but homes still spent 16 fewer days on the market this January than they did in the average January from 2017 to 2019. 
Home Listing Time on Market
In the 50 largest metropolitan areas in the United States, the typical home spent 68 days on the market, 15 days more than the previous January. This trend was seen across all regions, with larger metros in the West seeing the greatest increase (+27 days), followed by the South (+116 days), Midwest (+7 days) and Northeast (+6 days). Homes in Western metros are also spending 12 more days on the market than pre-pandemic times, but in all other regions homes are still selling more quickly.
Out of the 50 largest metros, 45 saw an increase in time on market compared to the previous year. Time on market increased the most in Raleigh (+41 days), Las Vegas (+40 days), and Denver (+40 days). Only three markets saw shrinking time on market: Richmond (-20 days), Milwaukee (-8 days), and Buffalo (-3 days). 
Listing Price Growth Stabilized in January
The national median list price remained stable compared to December, at $400,000 in January. However it is down from a record high of $449,000 in June (-11.1%). This median list price represents a yearly growth rate of 8.1%, which is only slightly lower than December’s 8.4% growth rate after larger declines for the past 6 months.
Median Home List Price
The percentage of homes with price reductions increased from 6.0% in January of last year to 15.3% this year. This percentage is still higher than it generally was before the pandemic, but it is lower than the percentage seen in 2019 (15.6%) when a recent run up in rates was also impacting market activity. 
Home Listing Price Reduction Share
In the largest metropolitan areas in the country, the combined annual median list price growth rate for active listings was 6.9%. Midwest metros had the highest growth rate in active listing prices, with an average increase of 12.8% over the past year. Prices in Memphis (+47.3%), Milwaukee (+43.7%), and Miami (+19.2%) saw the biggest increases among large metros. However, in each of these metros the mix of inventory has changed. On a price-per-square-foot basis, listing prices only grew by 19.6% in Memphis, 22.3% in Milwaukee, and 6.9% in Miami. 
Southern metros saw the largest increase in the percentage of homes with price reductions (+12.2 percentage points), followed by Western metros (+11.1 percentage points). Phoenix (+24.0 percentage points), Austin (+22.6 percentage points) and Tampa (+20.1 percentage points) had the largest increases in the percentage of homes with price reductions compared to last year.
January 2023 Regional Statistics (50 Largest Metro Combined Average)
January 2023 Regional Statistics vs Pre-Pandemic 2017-2019 (50 Largest Metro Combined Average)
January 2023 Housing Overview by Top 50 Largest Metros 

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