Even as interest rates increase and prices soften, housing market still robust
Vermont Business Magazine The latest housing data from RE/MAX for Burlington indicates that prices are way up from last year but have fallen over the last month. The current median home price is $410,000, up nearly 11 percent from last year but down 2.5 percent for the month.
The National Housing Report for August 2022 found that home sellers, on average, accepted offers below their listing prices last month – a further indication of rebalancing in the housing market. Mortgage interest rates have doubled since The Fed first raised rates last March and three times since for a total of 2.25%. Today, the 30-year fixed rate at New England Federal Credit Union is 6.162%. According to Freddie Mac, the average 30-year rate was 2.96 in 2021 and has averaged 7.76% since 1971.
Key metrics for Burlington below:
- $410,000 median sales price, up 10.8% YOY/down 2.5% MOM
- 297 closed transactions, down 17.7% YOY/up 29.1% MOM
- 257 new listings, down 3.4% YOY / up 5.3% MOM
- 1.04% close-to-list price ratio, up 1.6% YOY/down 1.6% MOM
- 21 days on market, down 16.5% YOY/up 19.7% MOM
- 0.9 months’ supply of inventory, down 12.1% YOY/down 23.4% MOM
As for the national scene, Nick Bailey, RE/MAX President and CEO said, “Patient buyers were rewarded in August, as prices softened from July. Sales increased as buyers ‘bought the dip’ – which was not the trend many people were expecting. The activity modestly depleted inventory, although the number of homes for sale remains significantly higher than this time a year ago. The late-summer burst of activity underscores the housing market’s resiliency. Despite the uptick in interest rates and concerns about the economy, demand remains strong. We’ll see what happens from here, but the August bump in sales was great news for the industry.”
According to August data in the RE/MAX National Housing Report, home sellers, on average, accepted offers below their listing prices last month – a further indication of rebalancing in the housing market. Across the report’s 51 metro areas, the average Close-to-List Price Ratio in August was 99%, meaning that homes sold for 1% less than the asking price. That’s down from 101% in July and 104% in April. This change helped push August sales 5.3% higher than July, while the Median Sales Price declined 2.4% to $410,000 after peaking at $426,000 three months earlier.
At the same time, new listings dropped 12.8% from July and inventory declined 1.8% after four months of double-digit growth. Even so, the number of homes for sale was 20% higher than in August 2021.
Two-thirds of the way through 2022, home sales have declined every month compared to 2021. Other notable metrics include:
• Months Supply of Inventory was 1.6 months in August, a decline from 1.7 in July but an increase compared to 1.2 in August 2021.
• Days on Market averaged 28, four days higher than July and three days more than August 2021.
• August’s Median Sales Price of $410,000 was 2.4% below July but was up 7% year over year.
Highlights and local market metrics for August include:
Of the 51 metro areas surveyed in August 2022, the number of newly listed homes was down 12.8% compared to July 2022 and down 13.1% compared to August 2021. The markets with the biggest decrease in year-over-year new listings percentage were Dover , DE at -59.4%, Milwaukee, WI at -33.6%, and St. Louis, MO at -27.1%. Leading the way in increased year-over-year new listings percentage were Washington, DC at +13.2%, Raleigh, NC at +10.7%, and New Orleans, LA at +8.4%.
Of the 51 metro areas surveyed in August 2022, the overall number of home sales was up 5.3% compared to July 2022, and down 20.1% compared to August 2021. The markets with the biggest decrease in year-over-year sales percentage were Bozeman , MT at -44.1%, Las Vegas, NV at -37.3%, and Phoenix, AZ at -31.4%. No metro area had an increase in year-over-year sales percentage.
Median Sales Price – Median of 51 metro area prices
In August 2022, the median of all 51 metro area sales prices was $410,000, down 2.4% compared to July 2022 and up 7.0% from August 2021. Two metro areas saw a year-over-year decrease in median sales price, San Francisco, CA at -4.2% and Honolulu, HI at -0.7%. Twenty metro areas increased year-over-year by double-digit percentages, led by Fayetteville, AR at +20.4%, Tampa, FL at +19.4%, and Orlando, FL at +17.5%.
Close-to-List Price Ratio – Average of 51 metro area prices
In August 2022, the average close-to-list price ratio of all 51 metro areas in the report was 99%, down from 101% compared to July 2022 and down from 102% compared to August 2021. The close-to-list price ratio is calculated by the average value of the sales price divided by the list price for each transaction. When the number is above 100%, the home is closed for more than the list price. If it’s less than 100%, the home sold for less than the list price. The metro areas with the lowest close-to-list price ratio were Washington, DC at 84%, followed by a tie between Bozeman, MT and Coeur d’Alene, ID at 97%. The highest close-to-list price ratios were in Burlington, VT at 104%, followed by a tie between Hartford, CT and Manchester, NH at 103%.
Days on Market—Average of 51 metro areas
The average days on market for homes sold in August 2022 was 28, up four days from the average in July 2022, and up three days from the average in August 2021. The metro areas with the lowest days on market were Dover, DE at 10 , Baltimore, MD at 11, followed by a two-way tie between Philadelphia, PA and Washington, DC at 13. The highest days on market averages were in Fayetteville, AR at 63, followed by a tie between New York, NY and Seattle , WA at 47. Days on market is the number of days between when a home is first listed in an MLS and a sales contract is signed.
Months’ Supply of Inventory – Average of 51 metro areas
The number of homes for sale in August 2022 was down 1.8% from July 2022 and up 20.0% from August 2021. Based on the rate of home sales in August 2022, the months’ supply of inventory decreased to 1.6 compared to 1.7 in July 2022 , and increased compared to 1.2 in August 2021. In August 2022, the markets with the lowest months’ supply of inventory were a tie between Albuquerque, NM and Manchester, NH at 0.7, followed by another tie between Charlotte, NC and Hartford, CT at 0.8.
About the RE/MAX Network
As one of the leading global real estate franchisors, RE/MAX, LLC is a subsidiary of RE/MAX Holdings (NYSE: RMAX) with more than 140,000 agents in almost 9,000 offices and a presence in more than 110 countries and territories. Nobody in the world sells more real estate than RE/MAX, as measured by residential transaction sides. RE/MAX was founded in 1973 by Dave and Gail Liniger, with an innovative, entrepreneurial culture affording its agents and franchisees the flexibility to operate their businesses with great independence. RE/MAX agents have lived, worked and served in their local communities for decades, raising millions of dollars every year for Children’s Miracle Network Hospitals® and other charities. To learn more about RE/MAX, to search home listings or find an agent in your community, please visit www.remax.com. For the latest news about RE/MAX, please visit news.remax.com.