What Buyer Activity Tells Us About the Housing Market
Though the housing market is no longer experiencing the frenzy of a year ago, buyers are showing their interest in purchasing a home. According to U.S. News:
“Housing markets have cooled slightly, but demand hasn’t disappeared, and in many places remains strong largely due to the shortage of homes on the market.”
That activity can be seen in the latest ShowingTime Showing Index, which is a measure of buyers actively touring available homes (see graph below):
The 62% jump in showings from December to January is one of the largest on record. There were also more showings in January than in any other month since last May. As you can see in the graph, it’s normal for showings to increase early in the year, but the jump this January was larger than usual, and a lot of that has to do with mortgage rates. Michael Lane, VP of Sales and Industry at ShowingTime+, explains:
“It’s typical to see a seasonal increase in home showings in January as buyers get ready for the spring market, but a larger increase than any January before after last year’s rapid cooldown is significant. Mortgage rate activity this spring will play a big role in sales activity, but January’s home showings are a positive sign that buyers are getting back out there . . .”
It's important to note that mortgage rates hovered in the low 6% range in January, which played a role in the high number of showings. What does this mean? When mortgage rates eased, buyer interest climbed. The jump in home showings early this year makes one thing clear – while rates may be volatile right now, there are interested buyers out there, and when mortgage rates are favorable, they’re ready to make their move.
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Single-family inventory levels are 20.05% higher on a year-over-year basis, and condo inventory levels are 13.15% higher.
Although many markets have seen a downtrend in pricing, San Francisco has remained incredibly resilient.
Although prices have been incredibly resilient in the East Bay, the future of this stability is very uncertain, as inventories have been growing at a tremendous rate.
Single-family homes continue to be a hot commodity, while condos continue to sit on the market.
Inventory levels are increasing drastically throughout the entire East Bay, with the area seeing over 40% more active listings than this time last year.
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