Single-family homes are featured in this aerial photo, taken from a Lennar Corp. development. was recorded in San Diego, California.
Bing Guan | Bloomberg | Getty Images
According to the National Association of Realtors, closed sales of existing homes in February were down 6.6% from January, above expectations.
The seasonally adjusted annual rate was 6.22 million units, an increase of 9.1% compared to February 2020.
Although homeowners are at the height of the historically bustling spring housing market, they are not putting their properties up for sale at the pace they would normally do at this time of year. The supply of houses for sale fell by 29.5% year-on-year, the largest annual decrease of all time, to 1.03 million apartments.
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At the current rate of sales, it would take two months for this offer to be exhausted. A year ago there was a three-month offer that is also viewed as low.
This scarce supply continues to drive property prices, which rose 15.8% year over year in February. The average price for an existing home sold during the month was $ 313,000. This is the highest February price ever recorded. Prices are rising on home bidding wars, but the median has also been moved higher as more sales occur at the higher end of the market.
Sales of homes priced over $ 1 million were 81% higher year over year. Homes priced between $ 100,000 and $ 250,000 fell 11%.
“The fact that, despite the decline in sales, the days in the market are fast and prices are rising,” said Lawrence Yun, brokers’ chief economist. “This means that it’s not because demand is disappearing from the market, it’s because there is a real lack of supply.”
Homes are also selling at the fastest pace ever recorded. The average market days fell to just 20.
Buyers also faced higher mortgage rates in February than late last year, which limited their purchasing power. The average rate on the 30-year fixed-rate mortgage fluctuated 2.8% in January, according to Mortgage News Daily. In February it began to rise steadily and reached 3.27% by the end of the month. Those who close their homes in February would likely have set their interest rates in January.
“As early as this year, the monthly cost of a $ 300,000 loan has increased by $ 70,” said Danielle Hale, chief economist at realtor.com. “Looking to the future, the large and growing cohort of consumers entering the early age of home buying will keep interest high. Whether buyers can turn that desire into property, however, depends on buyers’ incomes grow as the economy grows. Buyers are willing to let housing costs consume more of their monthly budget, or whether more homes for sale will help curb the pace of home price increases. “
Builders continue to face headwinds from faster production. B. higher land, labor and material costs and delays in the supply chain. Single-family home starts were lower than expected in February, but part of that could be related to the harsh winter weather in the south.
In the region, sales of existing real estate in the Northeast fell by 11.5% month on month. They fell 14.4% in the Midwest and 6.1% in the South. The west was the only region that saw a monthly increase of 4.6%.