This graph shows how sales exploded last year, right about the time that buyers realized that they could get a mortgage rate in the 3s:
Rates had been dropping over the previous three years, but sales were uniform – strong during the six-month selling season, and tapering off in fall/winter. But apparently a rate in the 3s must be irresistible, because the 4Q12 sales were, for the most part, better than the peak months of the three previous years.
The chart below shows the fourth-quarter sales out-numbering the new listings coming on the market, which is very unusual. There isn’t a direct relation between new listings and closed sales, but comparing them to previous sessions gives us a feel for the velocity.
|4th Qtr||# of New Listings||# of Sales||NL/Sales||Avg $/sf||DOM|
Given how sales have improved, it is amazing prices haven’t gone up further. Let’s dissect the fourth quarter by price ranges, and compare to previous 4Qs to further examine the hottest markets:
|4th Qtr||#Sales Under $900K||Avg $/sf||#Sales Over $900K||Avg $/sf|
Sales under $900,000 had a solid +26% improvement year-over-year, but it was the higher end that was scorching hot. The affluent are driving the market!
The number of sales over $900,000 increased 65% Y-O-Y for the fourth quarter of 2012, and their average pricing increased 9%.