Despite slowdown housing prices still higher than a year ago, realtors say
Despite a slowdown in the once-scorching housing market, homes are still selling at a faster rate and at higher prices than last year, according to new findings by the National Association of Realtors.
The association said the current median average time for a home on the market in July was 14 days, slightly better compared to 17 days a year ago.
"It's a historic low that homes are moving this fast," said Jessica Lautz, the realtors association's vice president of demographics and behavioral insights who compiled the findings.
For even broader comparison, it took about 96 days for homes to sell in 2011, Lautz said.
An imbalanced housing market, recession, or a correction
Stats like these come at a point where many in the housing industry are questioning whether the market is in a recession or a correction. Last month, National Association of Realtor Chief Economist Lawrence Yun sided with the National Association of Home Builders' assessment that the market is in a "housing recession" because "builders are not building."
But Lautz believes the market is closer to "a pre-pandemic phase," unlike the unusual fast-paced conditions over the past two years. She said the market is slower due to the lack of houses for sale, higher prices and high interest rates.
The median existing-home price for all housing types in July was $403,800, up about 10.8% from July 2021 ($364,600), as home prices increased in all four regions, the realtors association has reported.
Still a seller's market
Another example of an imbalanced market is the realtors association said in July that 82% of homes listed sold within a month – down from 89% the previous month.
Lautz said the decline may have to do with sellers now getting 2.8 offers for their homes, down sharply compared to 5.5 offers in April when some homes had potential buyers lining up outside the door waiting for a quick tour and subsequent possible bid.
Historically, Lautz added, 2.8 offers to buy a house equates to a competitive housing market.
"Now it is at a slower pace, but sellers should be quite happy to still be in a multiple bid situation," Lautz said.
About 39% of homes are still selling above the list price, a decline from 51% a month ago and around 52% a year ago, Lautz said.
Lautz also said that sellers currently have so much equity in their homes that can wait out any storm in the market if necessary.
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Rough for first-time homebuyers
The realtors association findings said the share of first-time buyers remained suppressed at 29% in July, down from 30% in June and 32% from the same time a year ago. Lautz said those would-be buyers are facing tough odds as they contend with making a sufficient down payment while dealing with a high interest rate and inflation.
"Unfortunately, I don’t think there's a quick fix," Lautz said.