The U.S. housing market keeps slowing down, with January having marked the sixth consecutive month of declining sales.
It was also the biggest year-over-year inventory increase in a decade — 6.4 percent — according to Re/Max’s National Housing Report for January. But the drop in sales and rise in inventory could make homes more affordable to more potential buyers, according to the report.
For years, low housing inventory pushed up demand, pricing many potential buyers out of the market. That trend seems to finally be reversing.
Falling home sales are keeping houses on the market longer, which is helping control housing costs, according to the Re/Max report, which examined the housing market in 54 U.S. metro areas.
Home sales in January dropped by 11 percent year over year, according to Re/Max. Only one market in the U.S. posted a year-over-year growth in home sales in January: Billings, Montana, population 110,000. The median sales price for a home sold in January was $234,000, an increase of 4.6 percent from January 2018, according to the report. That’s down from the 6.7 percent increase in sales price recorded the same time last year.
December 2018 was the only month since January 2012 to show a year-over-year drop in median home sales price nationwide.
Re/Max CEO Adam Contos called the inventory increase “a positive for homebuyers, as the market continues to swing their way.”
After years of increasing housing costs, sales figures are starting to trend in the buyer’s favor.
Last month, nine of the 54 metro areas Re/Max surveyed had a housing supply at or above six months, which indicates a buyer’s market. Miami led the way with a nine-month supply. That was up from 7.5 months in Re/Max’s October report.
The modest home sales price increases show demand is still there, Contos said. With healthy demand, increasing supply and cooling prices, homebuyers could be in a good position when the market heats up in the spring.
“The spring selling season shapes up to be as interesting as any we have seen in years,” Contos said.