Up, Up, and Away—the Housing Market Gains Momentum at the Start of 2023
After six consecutive months of declines, pending home sales rose 2.5% in December, while new-home sales rose 2.3%. According to the National Association of Realtors, the late 2022 resurgence of buyer activity coincided with a drop in mortgage rates, which fell mostly recently to 6.13% at the start of 2023.
Though rising demand signals a much-anticipated boost in housing affordability and perhaps the end of a year-long market slowdown, contract signings are still down nearly 34% year-over-year and prices remain historically high nationwide.
“The recent low point in home sales activity is likely over,” says NAR Chief Economist Lawrence Yun. “Mortgage rates are the dominant factor driving home sales, and recent declines in rates are clearly helping to stabilize the market.”