U.S. previously owned home prices fall for first time since 2012; prices decline in Spokane area
March 21, 2023 Updated Tue., March 21, 2023 at 6:56 p.m.
From staff and wire reports
The median sales price of a previously owned U.S. home slid in February for the first time since 2012, offering some relief for buyers still faced with high borrowing costs.
The median price slipped 0.2% in February from a year earlier to $363,000, according to the National Association of Realtors. The decrease was fueled by a 0.7% drop in the cost of single-family homes and coincided with a bigger-than-expected jump in sales during the month.
The retreat “is the strongest green shoot in an otherwise dismal housing market,” Robert Frick, corporate economist at the Navy Federal Credit Union, said in a note. He added that “prices need to drop more, and across more markets, before a general revival can occur.”
In Spokane, the median price of previously owned homes dropped from $399,000 to $390,000, when comparing sales prices in February to those a year ago, said Tom Hormel, president of the Spokane Association of Realtors.
“What we are seeing is a lot of lower-priced homes and stuff that is more affordable that is selling,” he said. “We are not seeing as much of the high-end homes selling.”
For instance, for Spokane County homes priced above $600,000, 78 sold in February 2022 compared to 50 last month. For the same time period, 14 of those homes sold for more than $1 million compared to only five last month.
“I think that we are still in really a solid position,” Hormel said. “We are not seeing the drop (in prices) that they are in some marketplaces.”
Homes in the Spokane area are selling for 98.7% of their list prices, he said, meaning that most sellers are getting the prices they are seeking.
“What we are seeing is a lot more of the lower-end homes coming to market and selling,” he said. “For February, we had a nine-day average time on market for new homes and 1.7-months supply. That’s been holding steady for the last few months.”
Nationally, the figures released Tuesday showed median selling prices decreased from a year earlier in the West and Northeast – the most expensive regions in the nation. Prices in the Midwest and South posted gains.
Overall, contract closings on existing homes jumped by the most since mid-2020, reaching an annualized pace of 4.58 million and ending a record yearlong slide. Despite the pickup, residential real estate remains constrained by the Federal Reserve’s aggressive policy tightening campaign that sent mortgage rates soaring last year and sidelined many prospective buyers.
The median selling price in the West dropped 5.6% from February 2022, the biggest annual decline since late 2011. Lawrence Yun, NAR chief economist, said the drop likely helped fuel a pickup in the region’s sales. Median prices in the Northeast decreased 4.5%, also the most in more than a decade.
While lower list prices could bring more potential buyers off the sidelines, high borrowing costs are putting the squeeze on affordability and a lack of homes for sale could limit how far prices will fall.
Data earlier this month also suggested home prices may have peaked. A Redfin report showed prices also hit a turning point last month, dropping from a year ago for the first time since 2012.
Spokesman-Review staff writer Thomas Clouse contributed to this report.
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