January brought out a rejuvenated crop of buyers with renewed enthusiasm for the new year. Sales totals usually start slow in the first half of the year due to ongoing inventory shortages. Continued declines in the number of homes available for sale may push out potential buyers who simply cannot compete for homes selling at higher price points in a low number of days, especially if mortgage rates continue to increase.
Year over year new listings were down 6.4% for single family homes and 4.3% for townhouse-condo properties. Pending sales decreased 40.8% for single family homes and 44.6% for townhouse-condo properties.
The median sales price was up 5% to $625,000 for single family homes and up 4.5% $395,000 for townhouse-condo properties. The supply of inventory decreased 7.7% for single family homes and 4.8% for townhouse-condo units.
The new U.S. president removed the .25%-point rate cut on mortgage insurance premiums for loans backed by the Federal Housing Administration (FHA), setting the table for what should be an interesting presidential term for real estate policy. FHA loans tend to be a favorable option for those with limited financial resources. Further, the president supports dismantling the Dodd Frank, the financial regulations which restricts overall loan making by banks. Meanwhile, wages are on the uptick for many Americans, while unemployment rates have remained stable and relatively unchanged for several months. The real estate market is ripe for more home purchasing if there are more homes available to sell.
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Source: Pacific West Association of Realtors