The February real estate market continued the trend of increasing prices and falling demand, but also showed some promising signs for the those waiting for more inventory with a slight increase in active listings and a large increase in new listings compared to last year. Median price was up nearly 4% year-over-year coming in at $435,000 this February compared to $419,900 last year. Total sold volume remained static from last February coming in at approximately $157 million, a scant 1% decrease from 2023 numbers. Units sold fell by 6% year-over-year compared to last February with 335 homes selling last month compared to 358 in 2023.
“I find the present condition of our real estate market to be quite promising,” states FAAR Board of Director Tamar Myers-Moffatt. “A growing number of homeowners appear ready to place their properties on the market, and there is a noticeable increase in active listings becoming available. The open houses that I have hosted have steady streams of buyers who seem prepared to proceed. My buyers are encouraged by the quality of homes available but are still faced with multiple offer scenarios.”
The real estate market is highly sensitive to even small fluctuations in mortgage rates and the dip in rates that started the year turned into many more buyers coming out. That increased competition was reflected in homes spending less time on the market than last February. Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service decreased 10% going from 40 days last February to 36 this year.
Active listings, new listings, and new pending contracts all increased for the first time since 2022, but available homes remain in chronically short supply and well-below pre-2020 levels. Active listings increased nearly 2%, with 661 homes on the market compared to 649 homes closing out last February. For comparison, there were 1,140 properties on the market at the end of February 2020 so the market is currently running at half of what was typical before the pandemic. While the most recent active listings increase is very small, there was encouraging news in new listings. The market saw a 32% increase of homes coming on the market this February with only 393 homes listed for sale at the end of February in 2023 compared to 520 new home listings this year. New pending contracts were up 8% with 468 pending transactions this February compared to 433 last year.
Myers-Moffatt continues, “All of my current buyers have a home to sell, so finding that next property is a point of concern. Leveraging post-occupancy addendums certainly helps, however many of the offers we receive also have home sale contingencies. This puts the seller in an especially vulnerable position when formulating their exit strategy for a new property. I think we can expect to see this trend continue through the spring and summer months.”
