The December housing market stayed red-hot in 2021, bucking typical seasonal trends and instead staying in-line with the numbers seen throughout the rest of the year. Though existing-home sales only saw a moderate decline (4.6%), new-home sales saw one of it’s largest month-to-month increases of the year (11.9%). Keep reading below for additional details from their respective monthly report ands a few helpful graphics.
New-Home Sales Experience a Slight Decline
The most recent report by the National Association of Realtors (NAR) was released showing that the month of December saw a slight decline in existing-home sales from the previous month, dropping by 4.6%, or a seasonally adjusted annualized rate of 6.18 million. Looking comparatively at December of 2020, this was a decline of 7.1% (from 6.65 million).
Lawrence Yun, NAR’s Chief Economist, attributes this slowdown to inventory issues rather than an actual decline in demand, stating:
December saw sales retreat, but the pull back was more a sign of supply constraints than an indication of a weakened demand for housing…Sales for the entire year finished strong, reaching the highest annual level since 2006.”
Prices also stayed high for the month of December, continuing their streak of both month-to-month and year-to-year appreciation, with the median pricing registering at $358,000. This is a 15.8% increase from December of 2020, marking one of the largest gains for the latter half of this year.
Existing-Home Sales Finally Move Up
New-home sales took the opposite route from existing in December, taking a big leap and finding a 11.9% increase compared to November, coming in at a rate of 811,000 units, according to the most recent analysis from the Dept. of Housing and Urban Development (HUD) and Census Bureau. Despite this large monthly gain, compared to the same month last year this was actually a decline of 132,000 units.
This marked increase meant two consecutive months of double digit growth, which should hopefully maintain as 2022 continues, as new-home inventory remains much higher than existing in the current market. Prices also remained high for these new builds, with the median sales price at $377,700 and average sales price at $457,300.
While there are some predictions for conditions to improve, the market is still looking heavily tilted toward sellers for the immediate future. Connect with your clients now to keep them abreast of your local market and when to plan their next transaction.