We received some housing market data, as the National Association of Realtors (NAR) released the New and Existing Home Sales data for January.
The NAR reported that Existing Home Sales decreased by 0.7% in January, which marked a full year of declining home sales numbers. Taken at face value, this data trend is troubling. It's important to keep in mind that, although buyer activity has slowed down, demand still remains strong.
It is likely that the increase in rates last year heavily contributed to the slowdown in the movement of existing homes. Many homeowners have been reluctant to sell because of the higher rate they would have to take on when buying a new home. In addition, the homes that have been listed are moving quickly. The average home was only on the market for 33 days.
New Home Sales, on the other hand, rose by an impressive 7.2%, marking the second consecutive month of positive movement. That being said, signed contracts on new homes were still down 19.4% when compared to January 2022. The latest Housing Market Index reported that "57% of builders are using incentives to bolster sales."
Next week, we'll take a look at January's Pending Home Sales data and the home price appreciation data for December.
