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    Buyers and Sellers Connected at a Record Pace on Thanksgiving Week

    Housing Market Recovery Index Highlights – Week Ending November 28

    • The realtor.com Housing Market Recovery Index remained steady at 112.8 nationwide for the week ending November 28th,  up 2.2 points over the prior week.
    • The ‘housing demand’ component – which tracks growth in online home searches – increased to 122.9, up 4.0 points over last week.
    • The ‘new supply growth’ component – which tracks growth of new listings – increased further past the recovery point this past week to 108.6, up 5.2 points over last week.
    • Regionally, demand for homes may be starting to grow slower than new listings in parts of the West and Northeast.

     

    National Recovery Trends

    With less people on the move and more time spent at home during this Thanksgiving holiday, housing activity saw a boost compared to this time last year. The realtor.com Housing Market Recovery Index increased to 112.8 nationwide for the week ending November 28th well above the pre-COVID baseline and up 2.2 points over the prior week.

    Traditionally, buyers and sellers take a short break at the end of November before one last rush before the end of year holidays. This year however, the inflow of buyers and sellers remained abnormally high for the season. The ‘housing demand’ component – which tracks growth in online home searches – increased to 122.9, up 4.0 points over last week. Additionally, the ‘new supply growth’ component – which tracks growth of new listings – increased further past the recovery point this past week to 108.6, up 5.2 points over last week, and reaching the highest point since the onset of the pandemic.

    If November is any indication, home shopping activity is set to beat more seasonal records these holidays. The backlog of buyers continues to grow faster than it did pre-pandemic, boding well for sellers but keeping the upward pressure on home prices. Despite the more normal flow of new listings, the overall number of options for buyers remains precariously low and buyers’ resilience will be tested once more during the month of December.

    The ‘home price’ component remained stable at 109.5 points this past week, 9.5 points above the January baseline. With supply at record lows and buyer competition showing continued strength, sellers have newfound leverage, enabling the fastest listing price growth recorded in more than two years.The ‘housing demand’ component remained visibly above recovery and increased to 122.9 this past week, an increase of 4.0 points over the prior week. While record-high prices, short supply and economic headwinds pose significant challenges, the lineup of buyers has not gotten significantly shorter since May.

    The ‘pace of sales’ component – which tracks differences in time-on-market – remains well above the pre-COVID baseline at 116.9, a 0.6 point increase over last week. Buyers and sellers are continuing to connect at a record pace going into the holidays.

    The ‘housing supply’ component – which tracks growth of new listings – has continued to push  past the recovery point this week, to 108.6, up 5.2 points over the prior week and 8.6 points above the January baseline. A sustained rebound in newly listed homes for sale remains elusive and highly localized but this week’s improvement is encouraging. The new supply index score is now at the highest point since the onset of the pandemic.

    LOCAL TRENDS

    While demand and supply continue to recover in most regions of the country, home buying interest may be starting to grow slower than seller confidence in parts of the West and Northeast. The West saw its Supply Index increase by 9.6 points and its Demand Index increase by 5.0 points. Similarly, the Northeast saw its Supply Index increase by 4.9 points and its Demand Index increase by 1.0 points. The moves however are well short of solving the shortage of options for buyers.

    Region Avg Recovery Index

    (week ending 11/28)

    w/w change Demand Index w/w Supply Index w/w Price Growth Index w/w Pace of Sales Index w/w
    West 122.3 +3.8 +5.0 +9.6 +1.4 +0.1
    Midwest 109.1 +1.3 +4.7 +3.3 +0.4 -1.0
    Northeast 112.8 +2.1 +1.0 +4.9 -0.1 +1.8
    South 106.0 +1.0 +2.8 -1.0 +0.6 +0.0

    47 of 50 Largest Markets Now Above the Recovery Benchmark

    Locally, a total of 48 markets have crossed the recovery benchmark as of this week, one less than the previous week. The overall recovery index is showing greatest recovery in Los Angeles, San Jose, Boston, San Francisco and Seattle, largely driven by improvements to the inflow of both buyers and sellers. This week, only Nashville, Oklahoma and Buffalo remained below the baseline.

    In the ‘housing demand’ component, all 50 markets are now positioned above the recovery trend, three more than the previous week, as buyer demand remained strong through Thanksgiving. The most recovered markets for home-buying interest include Boston, San Francisco, Sacramento, Washington D.C, and Philadelphia; with a housing demand growth index between 138 and 145.

    In the ‘home price’ component, 29 of the 50 largest markets seeing growth in asking prices surpass the January baseline, two less than the previous week. In the top 10 most-recovered markets, asking prices are growing at 14 percent year-over-year, on average. The most recovered markets for home prices include New Orleans, Austin, Houston, Riverside-San Bernardino, and Richmond; with a home price growth index between 112 and 114.

    In the ‘pace of sales’ component, 46 of the 50 largest markets are now seeing the time on market index surpass the January baseline, one more than the previous week. In the top 10 most recovered markets for pace of sales, time-on-market is now down 23 percent, on average, year-over-year. The most recovered markets for time-on-market include Los Angeles, Louisville, Virginia Beach, Las Vegas, and Riverside-San Bernardino; with a pace of sales growth index between 131 and 155.

    In the ‘housing supply’ component, 29 of the 50 largest markets saw the new listings index surpass the January baseline, 5 less than last week. Interestingly, markets where new supply is improving the fastest tend to be higher priced than those that have yet to see improvement, suggesting sellers are more active in the more expensive markets. The most recovered markets for new listings included San Francisco, San Jose, Boston, Seattle, and Los Angeles; with a new listings growth index between 151 and 178.


    How to read the index – the overall index is set to 100 for the last week of January based on average year-over-year trends that month, and updated every week relative to that baseline. A value of 100 means the market has recovered to January 2020 pace. The higher the index value, the higher the level of recovery. The lower the index value, the lower the level of recovery.

     

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