December 2023 saw a traditional year-end slowdown in housing market activity that boasts many similarities to December 2022, according to RE/MAX’s latest National Home Construction Report.
Highlights of the report:
- Sold homes were on the market an average of 47 days in the two Decembers – seven more days than in November 2023.
- December 2023 sales averaged 98% of sales price, the same as the previous year and slightly less than November 2023’s 99%.
- Monthly supply of inventory in both Decembers was 2.5, slightly less than 2.6 in November 2023.
These three indicators show no changes during the year.
Additional findings:
- Home sales in December were down 7.3% year-on-year and down 2.3% from November. As of 2022, the number of home sales has declined year-over-year in every month of 2023.
Inventories were down just 0.7% from December 2022, while they were down 10.4% from November. Inventories have declined year over year in each of the last seven months of 2023.
Two metrics posted year-over-year gains in December across the 52 metros surveyed:
- New listings in December were up 2.7% year-over-year, while they were down 24.3% from November.
- The median sales price of $400,000 is up 3.9% (or $15,000) from December 2022 and down 1.2% from November.
“There are many reasons to be encouraged about housing in 2024. High mortgage rates and low inventory levels in 2023 certainly contributed to a challenging market, but December’s data shows some positive signs for the new year,” said Nick Bailey, RE/MAX, LLC President and CEO. “If new construction begins to increase along with falling mortgage rates, buyers who are moving up may begin to explore their options, making room for new buyers.” We believe there is a lot of pent-up demand, especially among younger people.”
Christopher Arienti, broker and owner of RE/MAX Executive Realty outside Boston, agrees that there is a sense of new momentum in the market.
“The Boston metro market definitely saw its share of struggles in 2023,” Arienti said. “Transactions fell by almost 20% in most areas as people reacted to higher interest rates. The good news: As mortgage rates fell in late 2023, agents and homebuyers entered our market in 2024 with more optimism. If the buyer pool remains strong, our spring market could be exciting and you can feel the excitement among our agents.”
December local market highlights and results
New listings:
Of the 52 metropolitan areas surveyed in December 2023, the number of newly listed homes decreased 24.3% compared to November 2023 and increased 2.7% compared to December 2022. The markets with the most -a big drop in the percentage of new listings compared to the previous year are:
- Manchester, NH (-31.3%)
- Anchorage, Alaska (-18.1%)
- Indianapolis (-13.7%)
The markets with the largest annual growth in the percentage of new listings were:
- Bozeman, Montana (+75.6%)
- Houston (+22.0%)
- Phoenix (+19.6%)
Closed transactions:
Of the 52 metro areas surveyed in December 2023, the total number of home sales decreased 2.3% compared to November 2023 and 7.3% compared to December 2022. The markets with the largest sales percentage declines from the previous year were Providence, RI, at -18.4%, Boston at -17.9%, and Cleveland at -17.2%. The markets with the largest year-over-year sales percentage increases were Coeur d’Alene, ID, at +20.7%, Burlington, VT, at +9.5%, and Richmond, VA, at +6.8% .
Average selling price:
In December 2023, the median sales price across all 52 metropolitan areas was $400,000, down 1.2% from November 2023 and up 3.9% from December 2022. Markets with Biggest Year-over-Year Median Decline selling price were:
- New Orleans (-6.3%)
- Coeur d’Alene, ID (-3.7%)
- Charlotte, North Carolina (-2.3%)
The markets with the largest annual increase in average sales price are:
- Trenton, New Jersey (+19.6%)
- Hartford, Connecticut (+15.8%)
- Baltimore (+12.6%)
Close to list price ratio:
In December 2023, the average near-list price ratio for all 52 metro areas in the report was 98%, down from 99% in November 2023 and unchanged from December 2022. The near-list price ratio is calculated from the average of the sale price divided by the list price for each transaction. When the number is over 100%, the home closes for more than list price. If it’s less than 100%, the home is selling for less than list price.
The metro areas with the lowest price ratio on the list are Miami at 95%, followed by a three-way tie between: Bozeman, Montana, Coeur d’Alene, ID and New Orleans at 96%.
The metro areas with the highest price ratios near the list are Hartford, Conn., at 102 percent, followed by a four-way stretch between Burlington, Va., Manchester, N.Y., San Francisco, and Trenton, N.J., at 101 percent.
Days on Market:
The average number of days on the market for homes sold in December 2023 was 47, up seven days from the November 2023 average and unchanged from December 2022. Local areas with the fewest days on the market were Baltimore at 17, Washington at 19, and Philadelphia at 21. The highest average days on market were in Coeur d’Alene, ID at 94, Fayetteville, AR at 81, and Des Moines, IA at 77 .
Inventory delivery for months:
The number of homes for sale in December 2023 was down 10.4% from November 2023 and down 0.7% from December 2022. Based on the rate of home sales in December 2023, the inventory supply for months was 2.5, down from 2.6 in November 2023 and unchanged from December 2022. In December 2023, the markets with the lowest monthly supply of inventory were Trenton, NJ, with 0.7 and Seattle at 0.9, followed by a tie between Manchester, New York and Washington, D.C. at 1.1.
The markets with the highest monthly supply of inventory were Bozeman, Montana at 5.4, San Antonio at 5.3 and Miami at 5.2.
To read the full report, including more data, charts and methodology, click here.
