Prices fall month by month and from the peak (June 2022). The number of days on the market jumps. Homeowner With 3% Mortgage Has Disappeared buyer and seller Similarly, the overall market has shrunk.
By Wolf Richter of Wolf Street.
Sales of existing homes (single-family homes, condominiums, co-ops) fell further in July, down 2.2% from June, with a very dismal seasonally adjusted annualized sales rate of 4.07 million units, comparable to the same period last year in January. It was the lowest level since then. Lockdown lows in March 2020 are the lowest since the 2010 housing collapse, even as the median fell, more days on the market and supply increased to match 2022 highs. , above which supply was the highest since then. June 2020, according to the National Association of Realtors Today.
Seasonally adjusted annual sales decreased by 16.6% year-on-year. Compared to July of the previous year:
- July 2021: -32.5%.
- July 2019: -24.5%.
- July 2018: -24.5%.
What we are seeing is demand disappearing and supply disappearing as well. Because homeowners with 3% mortgages don’t buy new homes, they’re gone as buyers. Therefore, they did not put their current home up for sale and disappeared as a seller. I estimated that the overall housing market (buyers and sellers) shrunk by 20% as these homeowners disappeared simultaneously as buyers and sellers. In other words, churn is decreasing and supply from other sources (via historical data) is increasing. Y-chart).
This drop in demand is further evidenced by a sharp decline in mortgage applications, with August sales reported a month later likely to be even worse than July sales reported today. indicates that there is
July Actual Sales – Seasonally Adjusted Annual Rate – Decreased by 18.1% year-on-year to 322,000 units. Seasonal patterns are evident, with the green marked ‘spring season’ over (NAR data).
By region, sales decreased year-on-year in all regions.
Cash buyers and investors also pulled out. All-cash sales, which are mostly investors and second-home buyers, fell 11.2% year-on-year to 96,700 units in July, accounting for 25% of total sales.
median fell It climbed to $406,700 in July, down 1.7% from its peak in June 2022.
Today’s data reflects sales agreed for the month ending July and last weekend. The sales data, which ended a month ago in June and took place several weeks ago, reflects the final rush of the “spring sales season.” Spring sales are an annual phenomenon in which prices and sales always rise, even during the housing crash1. Spring sales are currently underway. The season is over. Prices will fall from the second half of the year he into January, but how much it will fall is just a question (historical data by YCharts).
A year ago in July 2022, the median price was down 3.6% from June 2022, following a series of big spikes followed by a big drop. July 2023 saw a much smaller month-over-month decline of -0.8%, and year-on-year the median price rose his 1.9%, but fell further from its peak in June 2022 (-1.7%). . ):
Just for fun, note the year-over-year price increases during the housing crash. Year-over-year percentage change does the following:
In both measures below, the number of days in the market increased year-over-year.
- Homes were on the market for 45 days in July before being sold or withdrawn from the marketincreased from the 34th of July 2022, according to realtor.com.
- The house was sold, but Does not include homes that have been withdrawn from the marketTwenty days were spent in the market in July, up from 14 days last July, according to the NAR.
Increased inventory for sale In July, it reached 1.11 million units, the highest level since November 2022.
increased supply 3.3 months from 2020, matching the high of 2022 (October and November were also 3.3 months) and the largest supply since June 2020.
Supply ranged from 3.0 to 4.3 months from 2017 to 2019 (historical data from YCharts).
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