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- Existing-home sales in October 2022 fell 5.9 percent, according to the National Association of Realtors.
- Inventory remains too low to meet demand, dropping 0.8 percent.
- Meanwhile, home prices are rising — the median sale price is now $379,100.
Existing-home sales — meaning sales of pre-owned homes, not new builds — have been on a downward trend all year. And with both mortgage rates and prices remaining high, home shoppers are not likely to be in a big rush to make that purchase. A new report by the National Association of Realtors (NAR) indicates that buyers are continuing to take a wait-and-see approach to the current market.
Existing-home sales fall for 9th straight month
Existing-home sales encompass all sales of non-new-construction homes, including single-family houses, condos, townhouses and co-ops. According to NAR numbers released November 18, U.S. existing-home sales fell in October 2022 for the ninth month in a row. The decrease of 5.9 percent from September amounts to a 28.4 percent year-over-year drop since October 2021.
The West region experienced the biggest monthly decrease in existing-home sales, with a drop of 9.1 percent since September and a year-over-year drop of 37.5 percent. Sales in the Northeast fell 6.6 percent for the month and 23 percent for the year, and the Midwest saw a decrease of 5.3 percent for the month and 25.5 percent for the year. The lowest decline was in the South region, where existing-home sales dropped 4.8 percent since September, and 27.2 percent year-over-year.
NAR Chief Economist Lawrence Yun attributes the dip in sales to the current market’s high interest rates.
“More potential homebuyers were squeezed out from qualifying for a mortgage in October as mortgage rates climbed higher,” Yun said in a statement. “The impact is greater in expensive areas of the country and in markets that witnessed significant home price gains in recent years.”
Median sale prices continue to rise
Despite the number of existing-home sales falling and interest rates rising, median sale prices remain stubbornly high. The nationwide median sale price for existing homes is now $379,100, which is slightly lower than September’s median of $384,800 but still up 6.6 percent over this time last year.
October 2022 was the 128th consecutive month of year-over-year median sale price increases — the longest-running streak since NAR started keeping records.
Regionally, home prices rose year-over-year in all four regions tracked by NAR. The West has the highest median price by far at $588,400, a 5.3 percent increase since October 2021. In the Northeast, the median rose 8 percent to $408,700, and in the South, it rose 8 percent to $346,300. The Midwest had the lowest median sale price in October at $274,500, which still represents a 5.9 percent increase over last year.
Housing inventory still scarce
Total housing inventory — the number of homes on the market for sale — sat at 1.22 million units at the end of October, a decrease of 0.8 percent both from September and year-over-year. This represents about a 3.3-month supply at the current sales pace, which is up from 2.4 months in October 2021 but still well below the amount needed for a balanced market, typically thought to be 5 to 6 months. “Inventory levels are still tight, which is why some homes for sale are still receiving multiple offers,” Yun said.