Whilst the numbers are a little varied compared to last week, with some increases, these increases are really from about 30-45 days ago. The big number to look at this week is the drop in showings, as this is what is driving everything else.
The information contained in here is from Bright MLS and covers the area of Pennsylvania covered by the Bright footprint.
New closed sales were 1697 that is 31.2% down compared to a year ago, however up about 19.4% from a week ago, which is a little understandable as we were at the end of the month when most people aim to settle on a home.
New purchase contracts were 1445, down 33.6% compared to a year ago and 1.8% compared to last week.
New listings 1486, these were also down compared to a year ago by 18.0% and 11.4% compared to last week.
New pending sales were 88, down 19.2% compared to a year ago, but up 10.2% compared to last week.
Showings were at 18162, down 31.7% compared to a year ago and fractionally up 0.9% compared to a week ago. This drop in showings which has been a trend this year compared to the previous four years is what is driving all the other numbers. As buyers feel priced out of the market, they are either stopping looking, or adjusting their price points. The low inventory, whilst improving, basically due to lower pending contracts and closed sales, is still not meeting the demand for houses. This causes prices to increase even as interest rates rise.
We are starting to see sellers price at lower rates than previously this year as reality sinks in that the market is cooling down. Sellers who could move and get a similar interest rate earlier in the year are now faced with increasing their mortgage rate from the low 3's to low 7's. Many are simply deciding to stay put limiting the inventory on the market still further.
Are we headed for a crash? There are mixed opinions on this. Personally, I think that home owners have far more equity in their homes than in previous downturns in the market. Yes, we are in the midst of a correction, and prices will flatten and may even drop, but most homeowners have enough equity that it will not affect them to the point they keep paying their mortgage. If employment drops from its present heights we may see more homes come on the market as people seek to sell and find something else they can afford either for sale or for rent.
If you have any questions about buying or selling in the current market contact Nick Vandekar, Selling the Main Line and Chester County with Long & Foster Real Estate Inc., office 610-225-7400, cell or text 610-203-4543, or email Nick@VandekarTeam.com.
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