2021, accounting for 90% of U.S. Home sales, second home sales surprised the market did not decline from the previous year, but continued to approach a fourteen-year high, which is still thanks to the United States ultra-low mortgage rates to attract buyers to enter, but also thanks to the shortage of supply.
The National Association of Realtors (NAR) announced that in January this year, the quarterly U.S. home sales annualized households of 6.69 million, the second highest level in 2006, but also higher than the market expectations of 6.6 million households, last December, the number of households revised down from 6.76 million to 6.65 million, so the number of households in January than in December rose by 0.6% from a year earlier.
The annualized number of homes sold in January rose 23.7% from January last year, the second highest sales growth rate since April 2006.
But home prices are still setting new highs. the median home sale value rose 14.1% year-over-year in January to $303,900, a record January sales price high, recording six consecutive months of double-digit year-over-year gains, with December sales prices last year already at a record high for December.
The commentary says that in addition to mortgage costs being at historic lows, there is another driver of rising home prices: limited supply.
The data already reflects this.
As of the end of January, there were 1.04 million completed homes listed for sale, breaking the record low for pending sales set in November and December of last year and down 25.7% year-over-year. At the current pace of sales, it takes only 1.9 months for all pending sales to be sold out, far less than the 3.1 months it took in January last year and matching the record low length of Time to sell out set in December last year. The market generally considers a sell-out period of less than 5 months to be a “tightening on the supply side” and 6-7 months to be a “healthy balance between supply and demand”.
NAR Chief Economist Lawrence Yun commented that more housing needs to be built now, and even though new housing starts are down, building permits, which reflect willingness to build, are still at their highest level in a decade. We have to get more inventory, and sales could be higher if more homes are on the market for sale.
This Thursday the U.S. Commerce Department reported 1.58 million new housing starts in January, down 6 percent from December and the first decline in five months, while building permits for housing rose 10.4 percent, the fastest rate of growth since 2006.
Overall, Yun believes that housing sales remain one of the forces supporting the U.S. economy, and the outlook for the U.S. housing market looks solid this year due to the possibility of additional fiscal stimulus from Congress and the approval of multiple vaccines to market.
Recent Comments