Even though mortgage rates have improved this year, the NSDCC pendings and sales are struggling to keep up with where they were in 2018 (Jan-Aug closed sales = 1,969 in 2018, and 1,925 in 2019):
With rates being 21% lower than last year, there really should be at least 5% more sales this year – but there have been 2% fewer. Sellers are holding out!
This is an interactive graph that compares the number of higher-end new listings per month.
We had a little uptick in July, but we settled back down in August. We only had five more listings last month than we did in August, 2018:
Here’s how it looks over ten years – we sure have more high-enders than we used to!
People ask, “How’s the market?”
Generally-speaking, the graph above reflects how today’s market conditions compare to last year.
Let’s also compare the weekly number of new pendings too (those marked pending in the past seven days). Since last Monday, we’ve had 44 new pendings, compared to the 59 we had in the same period last year when mortgage rates were already above 4.50%.
But this is an individual sport, and it depends on how you play it.
This seller probably thinks the market conditions are fantastic. They lowered their price 4% after ten days on the market, and then dumped another 6% to clinch a quick cash sale:
But how many sellers are willing to dump and run during their first two weeks on the market? Not many, and what the graph above shows is that sellers are holding out a bit longer instead.
The spurt from the lower rates didn’t last long – since they’ve hit the mid-3s again, you’d think we might get a couple of weeks of improvement:
The lower rates must have kicked in this week!
The new pendings were evenly distributed across our four price categories too.
The big news about the Fed dropping their rate last week didn’t cause people to rush out and buy a house – in fact, we didn’t even do as well as last year when rates were 1% higher (51 new pendings over the last seven days vs 54 last year at this time).
Rates being 1% lower means they are 22% better than last year:
Remember when rates in the threes used to set off a flurry of sales? Not any more:
This would be a good week for sellers to lower their price!
I don’t think this has happened before.
This week we had the exact same number of new listings AND new pendings as last week (102 & 47)!
The NSDCC active inventory this year has remained in check, however. We came into summer with a bigger load, but the number of homes for sale didn’t get a July pop like last year:
The Jan-July closed sales are 3% below those in 2018, and the total number of NSDCC pendings today is only 4% lower than last year at this time.
This year’s lower rates have only enabled us to keep close to last year’s activity, and those relatively-stable conditions have kept sellers from hitting the panic button too.
I guess I might have jinxed it last week when I said, “How about a late-summer surge!”
This week we had the lowest amount of NSDCC new pendings (47) since February, in spite of mortgage rates being about 3/4% lower than last year. Hopefully the rest of summer doesn’t just fade away:
Lower-end pricing has been on a runaway train lately. Last year at this time, the houses under $1,000,000 had list prices that averaged $433/sf. Today it’s $493/sf, which is a 14% increase!
This month the new pendings are hanging with last year’s counts, and with rates being supportive, maybe we’ll see a plateau in the red line above over the next 4-6 weeks?
We can guess why the pendings tapered off after summer – rates were on the run. Today’s rates are among the lowest in recent memory:
How about a late-summer surge!
How does our NSDCC inventory compare to last year’s counts? Here they are by price range:
| Price Range | ||||
| 0-$1.0M | ||||
| $1.0M-$1.5M | ||||
| $1.5M-$2.0M | ||||
| $2.0M+ |
The inventory under $1,500,000 is about the same as last year, and above $1,500,000 is a little bloaty.
There were 7% more listings between $1.5M and $2.0M that came to market in the first half of 2019 as sellers keep pushing higher. But not everyone deserves to be there just yet – there are 21% more active listings today in that $1.5M-$2.0M range.
Let’s look at how sales have been impacted.
Here are the NSDCC first-half closed sales by price range:
| Price Range | ||||
| 0-$1.0M | ||||
| $1.0M-$1.5M | ||||
| $1.5M-$2.0M | ||||
| $2.0M+ |
Mortgage rates that are at least 1/2% lower this summer are only keeping sales close to what they were in 2018 – and any extra inventory just waits in line, hoping good fortune will come their way.
Are you looking for an experienced agent to help you buy or sell a home?
Contact Jim the Realtor!
CA DRE #01991628, CA DRE #00873197
