US Housing Market Summary For January 2021

17 Feb 2021 11:33 AM | WiscoREIA (Administrator)

US Housing Market Summary For January 2021


The housing market before the pandemic was remarkably strong. The coronavirus crisis response was unprecedented. The federal government ordered a de facto shutdown of the entire private economy, closing an estimated eighty percent of businesses. It has caused unemployment to soar to at least ten percent, while tens of millions are idled.

According to the National Association of Realtors®, overall sales decreased year-over-year, down 17.2% (4.33 million units in April 2020) from a year ago (5.23 million in April 2019). The national median existing single-family home price in the first quarter of 2020 was $274,600, up 7.7% from the first quarter of 2019 ($254,900). Housing market data of the last month showed that it is beginning to heat up again as more sellers and buyers enter the market.

Realtor.com's latest national housing report shows that listing price growth continued to increase at double-digit rates compared to last year. Homes continued to sell almost two weeks more quickly than last year. Inventory continues to decrease, still posing a challenge for buyers. Buyers will face a competitive spring season as sellers slowly crawl back into the market and inventory remains low. Homebuyers may need to prepare for a competitive season with lower inventory (especially in more affordable price categories), continuing growth in asking prices in response to strong buyer demand, and slowly rising interest rates.

Housing Market Trends For Supply

Nationally, the inventory of homes for sale in January decreased by 42.6% over the past year, a higher rate of decline compared to the 39.6% drop in December. This amounted to 443,000 fewer homes for sale compared to January of last year. Despite a slightly more active December, sellers once again entered the market more hesitantly in January, which saw 23.2% fewer new listings enter the market compared to last year.

A declining inventory suggests that buyers are more active than sellers, perhaps looking to lock-in record-low mortgage rates. The total housing supply is not enough to mark it as a buyer’s real estate market and it going to continue to be difficult for buyers to find their perfect home, while sellers who face little competition amongst each other may find selling their home easier this fall season than is typical.

Housing inventory in the 50 largest U.S. metros overall declined by 41.8% over last year in January, greater than last month’s 38.6% decline. While in December, all regions except for the South saw a year-over-year increase in new listings, in January, all regions saw renewed declines as sellers became skittish entering into 2021. New listings were down 24.0% in the South, 22.6% in the Midwest,  14.4% in the Northeast, and 6.6% in the West.

Housing markets that saw the largest year-over-year decline in newly listed homes included Cleveland (-37.1%), Jacksonville (-36.9%), and Memphis (-32.6%). Only San Jose, San Francisco, and Denver saw newly listed homes increase, by 24.8% and 14.4%, and 1.8%, respectively. Overall, newly listed homes in the largest 50 metros decreased by 17.3% compared to last year.

According to the National Association of Realtors®, total housing inventory at the end of December totaled 1.07 million units, down 16.4% from November and down 23% from one year ago (1.39 million). Unsold inventory sits at an all-time low 1.9-month supply at the current sales pace, down from 2.3 months in November and down from the 3.0-month figure recorded in December 2019. For existing single-family homes, the unsold inventory sits are 2.2 months. 

Total housing inventory at the end of December totaled 1.07 million units, down 16.4% from November and down 23% from one year ago (1.39 million).
Total housing inventory at the end of November totaled 1.28 million units, down 9.9% from October and down 22% from one year ago (1.64 million). 
Total housing inventory at the end of October totaled 1.42 million units, down 2.7% from September and down 19.8% from one year ago (1.77 million).
Total housing inventory at the end of September totaled 1.47 million units, down 1.3% from August and down 19.2% from one year ago (1.82 million). 
Total housing inventory at the end of August totaled 1.49 million units, down 0.7% from July and down 18.6% from one year ago (1.83 million). 
Total housing inventory at the end of July totaled 1.50 million units, down from both 2.6% in June and 21.1% from one year ago (1.90 million).
Total housing inventory at the end of June totaled 1.57 million units, up 1.3% from May, but still down 18.2% from one year ago (1.92 million).
Total housing inventory at the end of May totaled 1.55 million units, up 6.2% from April, and down 18.8% from one year ago (1.91 million).
Total housing inventory at the end of April totaled 1.47 million units, down 1.3% from March, and down 19.7% from one year ago (1.83 million).


Housing Market Trends For Listing Prices

Realtor.com's data shows that the median national home listing price grew by 15.4% over last year, to $346,000 in January, higher than last month’s growth rate of 13.4%. Listing prices in the nation’s largest metros grew by an average of 10.9% compared to last year, higher than last month’s rate of 8.8%.

In October, the median listing price held steady at the summer 2020 high of $350,000, resisting the usual seasonal decline for the first time in Realtor.com's recorded data history. Had there been no pandemic this year, prices would have normally dropped 1-4% from summer’s price peak by October.

The nation’s median listing price per square foot also grew by 17.5% compared to last year, an acceleration from the 15.9% growth seen last month. In May, the nation’s median listing price growth had deaccelerated, driven by diminished seller expectations and a shift in the mix of homes for sale.

According to the National Association of Realtors®, the median sales price for all existing housing types in December was $309,800, up 12.9% from December 2019 ($274,500). Home prices increased in every region and December's national price increase marks 106 straight months of year-over-year gains.


The following is a tabulated summary of the National Listing Price Trends from March 2020 to January 2021 on Realtor.com.

National Housing Price Trends 2020 – 2021

In the first two weeks of March, the median listing prices were increasing 4.4 percent year-over-year on average.
The median list price on pending contracts in the four weeks through April 26 was up 2.6% from one year ago.
The April national median listing price was $320,000, up 0.6 percent year-over-year.
This was a further deceleration from the 3.8 percent year-over-year growth seen in March.
In the three weeks of May ending May 9, May 16, and May 23, the median national listing price posted an increase of 1.4 percent, 1.5 percent, and 3.1 percent year-over-year, respectively.
Locally, 77 of 100 large metros saw asking prices increase over last year.
In May 2020, the median national home listing price grew by 1.6 percent year-over-year, to a new high of $330,000.
This is a re-acceleration from the 0.6 percent year-over-year growth seen in April.
In June, the median national home listing price grew by 5.1 percent year-over-year, to a new high of $342,000.
This is an acceleration from the 1.6 percent year-over-year growth seen in May.
The nation’s median listing price per square foot also grew by 7.7 percent year-over-year, an acceleration from the 5.4 percent growth seen last month.
The July national median listing price was $349,000, up 8.5 percent year-over-year. Prices rose 7.8 percent in larger markets.
This is an acceleration from the 5.1 percent year-over-year growth seen in June.
The nation’s median listing price per square foot also grew by 9.5 percent year-over-year, an acceleration from the 7.7 percent growth seen in June.
The median national home listing price grew by 10.1 percent year-over-year, to a new high of $350,000 in August.
This is an acceleration from the 8.5 percent year-over-year growth seen in July.
The median national home listing price grew by 11.1% over last year, to $350,000 in September.
This is an acceleration from the 10.1% growth seen in August.
The nation’s median listing price per square foot also grew by 13.9% compared to last year.
In October, the median national home listing price grew by 12.2% over last year, to $350,000.
This is an acceleration from the 11.1% growth seen in September.
The nation’s median listing price per square foot also grew by 14.7% compared to last year.
In November, the median national home listing price grew by 12.7 percent year-over-year, to $348,000.
The nation’s median listing price per square foot also grew by 15.4% compared to last year.
In December, the median national home listing price grew by 13.4 percent year-over-year, to $340,000.
The nation’s median listing price per square foot also grew by 15.9% compared to last year.
In January 2021, the median national home listing price grew by 15.4 percent year-over-year, to $346,000.
The nation’s median listing price per square foot also grew by 17.5% compared to last year.

Among the largest 50 metros, listing prices are increasing most in northeastern markets, where they are now growing at an average rate of 16.8% over last year, compared to a growth rate of 12.3% for western metros, 10.4% for midwestern metros, and 8.0% for southern metros. This month, price growth accelerated in all regions compared to last month.

Austin (+30.2%), Rochester (25.9%), and Los Angeles (+22.4%) posted the highest year-over-year median list price growth in January. Miami (-3.2% year-over-year) and Minneapolis (-0.4%) were the only top 50 metros to see listing prices decline year-over-year in January.

Highest Year-Over-Year Price Gains Highest Year-Over-Year Price Declines
May Los Angeles-Long Beach-Anaheim, CA (+14.9%) Detroit-Warren-Dearborn, MI (-3.4%)
Pittsburgh, PA (+14.0%); and Cincinnati, OH-KY-IN (+12.1%) San Antonio-New Braunfels, TX (-3.2%)
Seattle-Tacoma-Bellevue, WA (-3.1%)
June Pittsburgh, PA (+23.8%) Miami-Fort Lauderdale-West Palm Beach, FL (-2.3%)
Los Angeles-Long Beach-Anaheim, CA (+21.4%) Jacksonville, FL (-0.8%)
Cincinnati, OH-KY-IN (+16.6%) Dallas-Fort Worth-Arlington, TX (-0.7%)
July Pittsburgh, PA (+25.0%) Miami-Fort Lauderdale-West Palm Beach, FL (-1.5%)
Los Angeles-Long Beach-Anaheim, CA (+24.3%) Orlando-Kissimmee-Sanford, FL (-0.9%)
Cincinnati, OH-KY-IN (+18.5%)
August  Philadelphia-Camden-Wilmington, PA-NJ-DE-MD (+18.6 percent) Miami-Fort Lauderdale-West Palm Beach, FL (-0.2 percent)
Cincinnati, OH-KY-IN (+17.8 percent)
Cleveland-Elyria, OH (+15.6 percent)
September  Cincinnati, OH-KY-IN (+16.9%)
Boston-Cambridge-Newton, MA-NH (+16.4%)
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD (+15.6%)
October  Los Angeles (+16.9%)
Philadelphia (+16.7%)
Cincinnati (16.3%)
November  Austin (+20.0%)
Los Angeles (+16.1%)
Riverside-San Bernardino (15.9%)
December  Austin (+16.9%) Minneapolis (-1.6%)
Riverside-San Bernardino (17.2%)
New Orleans (+16.8%)
January 2021 Austin (+30.2%) Miami (-3.2%)
Rochester (25.9%) Minneapolis (-0.4%)
Los Angeles (+22.4%)

Housing Market Trends For Sales

Homes for sale in January 2021 were being scooped up more quickly than last year as buyer demand remained solid through the new year. The typical home spent 76 days on the market this January, which is 10 days less than last year. However, this yearly decline has slowed compared to December 2020, when homes sold 13 days more quickly than the previous year.

In the 50 largest U.S. metros, the typical home spent 60 days on the market, and homes spent 12 days less on the market, on average, compared to last January. Among these 50 largest metros, the time a typical property spends on the market has decreased most in the South and West, where the typical property spent 2 weeks less on the market compared to last year, followed by the Midwest (-12 days) and the Northeast (-11 days).

Among larger metropolitan areas, homes saw the greatest decline in time spent on the market compared to last year in Virginia Beach (-27 days); Sacramento (-24 days); and Birmingham (-22 days). Only two markets saw time on the market increase compared to the previous year: New York (+11 days), and Miami (+5 days).

Existing-home sales rose in December, with home sales in 2020 reaching their highest level since 2006, according to the National Association of Realtors®. Activity in the major regions was mixed on a month-over-month basis, but each of the four areas recorded double-digit year-over-year growth in December.

Total existing-home sales completed transactions that include single-family homes, townhomes, condominiums, and co-ops, increased 0.7% from November to a seasonally-adjusted annual rate of 6.76 million in December. Sales in total rose year-over-year, up 22.2% from a year ago (5.53 million in December 2019).

Housing Sales By Region – December 2020 (By N.A.R.)
Northeast Existing home sales climbed 4.5%, recording an annual rate of 930,000, a 27.4% increase from a year ago.
The median price in the Northeast was $362,100, up 19.0% from December 2019.
Midwest Existing-home sales were unchanged, recording an annual rate of 1,590,000 in December, but up 26.2% from a year ago
The median price in the Midwest was $235,700, a 13.7% increase from December 2019.
South Existing-home sales increased 1.1% to an annual rate of 2,860,000 in December, up 20.7% from the same time one year ago.
The median price in the South was $268,100, an 11.3% increase from a year ago.
West Existing-home sales fell 1.4% from the month prior, recording an annual rate of 1,380,000 in December, a 17.9% increase from a year ago.
The median price in the West was $467,900, up 14.2% from December 2019.


First-time buyers were responsible for 31% of sales in December, unchanged from the same time in 2019, but down from 32% in November 2020. Individual investors or second-home buyers, who account for many cash sales, purchased 14% of homes in December, identical to the share recorded in November 2020 and a small decline from 17% in December 2019.

All-cash sales accounted for 19% of transactions in December, down from 20% in both November and December 2019. Distressed sales – foreclosures and short sales – represented less than 1% of sales in December, equal to November's percentage but down from 2% in December 2019.

Despite dropping slightly in the last month of 2020, the latest pending home sales registered as the highest ever recorded in December, according to the National Association of Realtors®. The decrease marks the fourth consecutive month of month-over-month declines. While contract transitions fell in one of the four major U.S. regions, activity climbed or remained flat in the three other areas. Compared to a year ago, all four regions witnessed double-digit gains in pending home sales transactions.

Pending home sales fell slightly in October, according to the National Association of Realtors. Contract activity was mixed among the four major U.S. regions, with the only positive month-over-month growth happening in the South, although each region achieved year-over-year gains in pending home sales transactions. All regions experienced double-digit year-over-year increases.

NAR's Pending Home Sales Index (PHSI), fell 0.3% to 125.5 in December. Year-over-year, contract signings jumped 21.4%. An index of 100 is equal to the level of contract activity in 2001. The Northeast PHSI rose 3.1% to 112.0 in December, a 22.1% increase from a year ago. In the Midwest, the index fell 3.6% to 111.7 last month, up 13.9% from December 2019.

Pending home sales in the South increased 0.1% to an index of 150.6 in December, up 26.6% from December 2019. The index in the West was unchanged in December, remaining at 111.3, which is up 18.9% from a year ago.


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