CNBC provided a report with some updates about the housing market last week. December saw a short-term pullback from buyers, but in January buyers returned to the market in hopes of finding what they want and need. Unfortunately, the market is still at a record low supply, which means sellers have an even bigger advantage now compared last year or even last month.
The National Association of Realtors reported an increase in closed sales of existing homes in January, which went up 0.6% compared to December.
In January sales were at a 6.69-million-unit (seasonally adjusted, annualized) rate, which is a 23.7% increase compared to the same time last year. An increase this high has not been seen since April 2006. Lawrence Yun, chief economist for the National Association of Realtors stated, “Home sales are continuing to play a part in propping up the economy.” He also added “With additional stimulus likely to pass and several vaccines now available, the housing outlook looks solid for this year.”
By the end of January there were 1.04 million homes up for sale, however, this number is 26% lower compared to this time last year. The way demand is going the market is at a 1.9-month supply, which is the lowest since 1982 when the National Association of Realtors started tracking this number. This time last year the market was at a 3-month supply.
We have been dealing with a big imbalance between supply and demand for a while now, and so the prices are continuing to go up. The median price of an existing home that was sold in January was $303,900, which is a 14.1% increase since this time last year. This is the highest January price ever recorded by the National Association of Realtors.
According to Lawrence Yun, “We need to build more homes,” he added “Even though housing starts show a decline, it is interesting that the housing permits, the desire to build homes, remains at the highest in over a decade.”
If you plan to sell, now is the time, since demand will stall a little as the mortgage rates start to go up. If you are an investor or developer, now is the time to take this opportunity, because someone needs to fill the supply gap and it can be you. If you want to buy a home, be sure to talk to us so that we can help you get the fairest possible price during a hot seller’s market. Amin Vali Real Estate Investment is equipped to help you no matter what you want and need to do this year.