In December, the number of homes sold posted their largest monthly decline since the start of the COVID-19 pandemic, according to a report by Redfin released Friday. Homes fell 3.6% month over month in December to a seasonally adjusted total of 579,000 homes, marking the largest month-over-month decrease since May 2020. This is a 10.7% decrease from a year ago, the largest year-over-year decrease since June of 2020.
Of the 88 metropolitan areas Redfin analyzed, 79 saw month-over-month declines in home sales with the largest declines coming in Nassau County, New York (-22%), New Brunswick, New Jersey (-22%) and Albany, New York (-21%). On the other side, Greensville, South Carolina, Greensboro, North Carolina, and Baton Rouge, Louisiana, saw the largest increases at 9%, 8% and 7%, respectively.
While home sales typically slow down during the winter months, experts also say that record low housing inventory in many areas is also partially to blame.
In December, there was a total of 1,334,600 active listings, according to Redfin. This is down 3.2% from the month prior and 18.9% year over year. Detroit was the only metro that posted a year-over-year increase in the number of seasonally adjusted active listings, with a 4% increase. Baton Rouge, (-52%), San Jose, California (-49%), and San Francisco (-46%), posted the largest year-over-year declines.
In addition, the number of new listings fell 2.4% in December from November to 629,900.
“Home sales are slumping, but not for lack of demand,” Redfin chief economist Daryl Faiweather said in a statement. “There are plenty of homebuyers on the hunt, but there is just nothing for sale. In many markets, shopping for a home feels like going to the grocery store only to find the shelves bare. In January, I expect to see more buyers and sellers in the market, but demand will increase more than supply — pushing prices higher at the start of this year.”
Reflecting this high level of demand are the 42.8% of homes that sold for over list price in December and the median number of days a home spent on the market before going pending, which came in at 24 days.
Although the percentage of homes that sold for over list price is down 14 percentage points from the record high set in June 2021, it is still up nine percentage points compared to a year ago. San Jose (73.8%) and Oakland, California (73.8%) saw the highest percentage of homes selling over list price.
Similarly, the median days on market were up from the record low of 15 days set in June 2021, but were down seven days compared to a year prior. The fastest selling markets were Seattle, Denver, Indianapolis and Grand Rapids, Michigan, with half of all homes pending sale in just seven days.
With demand remaining high and inventory remaining low, home sale prices posted a 15% increase from a year earlier in December. Bridgeport, Connecticut, was the only metro area showing a decrease, dropping 0.4%. The largest price increases were seen in Austin (30%), North Port, Florida (28%), and Phoenix (28%).