November 2022 U.S. housing data from RE/MAX indicates more opportunities for buyers may be on the horizon.
Typical of this time of year, November 2022 saw a dip in home sales – down 12% from October and down 37% year-over-year.
Although this can be considered normal given seasonal factors, the severity of the drop is best explained in the context of 2021 being an outlier for housing, coupled with a response to the fluctuating interest rates and ongoing economic uncertainty. And as new listings and home sales decline, other housing indicators point to some potential benefits for prospective buyers. This is welcome news after nearly a decade of the housing market favoring sellers.
According to the latest RE/MAX National Housing Report, homes sold in November were on the market for an average of 39 days. That was four more days than in October and a full week more than in November 2021. For-sale homes sat on the market the longest in Fayetteville, AR averaging 72 days, Seattle, WA at 62 days, and Bozeman, MT at 59 days.
In another encouraging sign for buyers, there were also more homes for sale than this time a year ago. November’s 2.5 months supply of inventory was up from 2.3 in October and more than double the 1.2 of one year ago.
“We’ve been seeing a return to a more balanced market, where not just sellers are in the driver’s seat. Sellers and buyers are each able to negotiate, with neither having a built-in upper hand,” said Nick Bailey, RE/MAX President and CEO. “This is especially good news for long-suffering buyers who are still dealing with affordability issues. Buyers welcome having more choice as there are more homes on the market, and they are taking longer to sell.
“More good news for buyers: Prices are flattening and actually decreasing in some markets. Things may bounce around a bit longer, especially into the first half of 2023, but it seems like the market is shaking off the last vestiges of the 2021 overheating. Balance seems to be returning – as it usually does.”
In a recent interview with Forbes, Bailey predicted 2023 will be a better year for housing as demand for homes is still incredibly strong. Citing a recent survey conducted by RE/MAX in partnership with SWNS Media Group, Bailey noted 84% of Gen Z, 79% of Millennials and 61% of survey respondents age 77 or older plan to buy a house or condo in the next few years.
RE/MAX Gold Manager and REALTOR® Angelo Gallo, who is based in Cupertino, CA, added, “After several years of what can only be considered abnormal selling and buying seasons, it seems the nine Bay Area counties are starting to experience a more normalized market. Yes, inventory levels have increased, and sales are down, but we must ask ourselves, ‘Compared to what?’
“We are now seeing the market return to pre-pandemic levels. That’s not a bad thing. Balance has returned to the Bay Area real estate market, and this is healthy for all consumers.”
Curious about how housing market in the U.S. is continuing to shift? Here’s the need-to-know data from the latest RE/MAX National Housing Report:
Home Prices Are Stabilizing
In November 2022, the median of all 53 metro area sales prices was $394,000, down 1.3% compared to October 2022, and up 3.7% from November 2021. The markets with the biggest year-over-year decrease in median sales price were Des Moines, IA at -4.2%, San Francisco, CA at -1.7%, and Pittsburgh, PA at -1.0%. Five metro areas increased year-over-year by double-digit percentages, led by Fayetteville, AR at +19.6%, Omaha, NE at +12.2%, and Orlando, FL at +11.6%.
The Number of New Listings Took a Tumble
Of the 53 metro areas surveyed in November 2022, the number of newly listed homes was down 21.4% compared to October 2022, and down 14.3% compared to November 2021. The markets with the biggest decrease in year-over-year new listings percentage were Phoenix, AZ at -33.4%, Portland, OR at -32.3%, and San Francisco, CA at -29.8%. Leading the year-over-year new listings percentage increase were Washington, DC at +25.7%, Baltimore, MD at +24.7%, and Dover, DE at +15.7%.
Homes Are Selling for Less than List Price
The average Close-to-List Price Ratio in November was 98%, meaning that homes sold, on average, for 2% less than the asking price. The ratio was 101% a year ago and flat compared to October 2022. The metro areas with the lowest close-to-list price ratio were a tie between Coeur d’Alene, ID and Miami, FL at 95%. The highest close-to-list price ratios were Burlington, VT at 102%, followed by a four-way tie between Hartford, CT, Manchester, NH, Richmond, VA, and Trenton, NJ at 101%.
In the same article from Forbes, Ward Morrison, President and CEO of Motto Franchising, LLC, shared some words of wisdom for those looking to enter the real estate market now or in the near future:
“Ultimately, the key to home buying success is finding a trusted real estate and mortgage advisor that is prepared to support you in what could be the most complex transaction of your lifetime.”
Contact a local RE/MAX agent today if you’re ready to make a move.