You may have noticed I skipped the December update! In short, the 7%+ interest rates, paired with the holidays drove the market to a screeching halt for a minute. With the start of the new year, lower rates and the spring market approaching, I have seen a big pick up in the market! Details below.
Single-family home sales in January for Boone County finished the month down 25% to 99 closed sales. When comparing sales to 2021, down 22%; 2020, down 19%; and 2019, down 4%. Sales in the City of Columbia made up 58 of those sales, but the sales decline was steeper, down 37%. (I believe this shows mid mo is moving towards a more sustainable and level market)
Prices were up double digits from last year, with the average price jumping 12% to $317,961 and the median price leaping 17% to $280,000. In the City of Columbia, the average price only increased 2% to $320,041 and the median price was up 13% to $294,000.
Homes are spending more time on the market than the past couple of years, with days on market up 40% to 40 days (cumulative days is 52, a 92% increase). Homes priced above $400K are averaging 57 days on market while homes below are at 33 days.
The months supply of housing still remains low for the overall market for January at 2.67 months. This is a 132% increase in supply but still far below the 5 to 6 months’ worth of inventory, we’d like to have this time of year. The average supply for the previous ten years has been 5.17 months for January. We have seen much larger inventory increases in homes priced between $500K to $1 million, where supply exceeds 8 months. The increased inventory in this price range may signal the beginning of a shift in the market from a sellers’ market to a buyers’ market.
New listings hitting the market in January were down 12% from last year but recovered from the steep decline in December of 2022. However, new listings are still down around 30% or more from what we used to see for the month of January.
Pending listings were down 11% from last year to 149 homes under contract; conversely, 149 is in line with the average number of pending sales in the previous ten years.
Mortgage rates during the month of January were much more favorable than we saw in the fourth quarter of 2022. The 30 Yr FRM was even below 6% for a short period of time a few weeks ago. However, rates have risen steadily since then, and the 30 Yr. FRM was around 6.5% on Friday after the jobs report showed the economy added more jobs than what had been forecasted, causing the yield to rise for the US 10-Year Treasury.
The market still seems to be in a transitional phase with inventory increasing in some price ranges, but that could be short-lived as the start of the spring market is just around the corner. Also, the number of pending listings could be a sign that consumers have adjusted to the idea that mortgage rates are going to remain in a more realistic range.
Source – Columbia Board of Realtors CEO, Brian Toohey, MBA, RCE, ePro