U.S. Used Home Sales Continue to Decline in December, Biggest Yearly Decline Since 2008

The National Association of Realtors (NAR) announced that December 2022 U.S. used home sales were down from the previous month, the lowest level in more than a decade. It was one of the worst declines on record for a full year on the back of soaring loan rates.

Key Point
  • December resale home sales fell to 4.02 million annualized seasonally adjusted units
    • Lowest level since 2010
    • The median estimate of economists is 3.95 million units
    • 11 consecutive months of month-on-month decline, the longest on record
  • Over 5 million units in 2010, down 17.8% year-on-year
    • Largest decrease since 2008

Pre-owned home sales (seasonally adjusted, annual rate)

Source: NAR

Aggressive monetary tightening in 2022 pushed mortgage rates to their highest level in 20 years, crowding out many potential buyers from the market. Loan rates have peaked in recent weeks, helping builders’ sentiment to improve, but the outlook remains uncertain.

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“December was another tough month for buyers, with inventories remaining limited and loan rates still high,” NAR chief economist Lawrence Yun said in a statement. “However, sales are expected to pick up soon, as loan rates have visibly declined from their peaks late last year,” he explained.

Second-hand home sales inventory fell to 970,000 units, the lowest level since March. Inventory to sales ratio is 2.9 months. The same month last year was 1.7 months. Inventories are considered tight when the ratio is below five months.

Pre-owned home prices (before seasonal adjustment, median) rose 2.3% year-on-year to $366,900 (about 47.6 million yen). Prices rose across all regions. Yoon said the rate of gains was the slowest since May 2020.

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See table for detailed statistics.

Original title:US Home Sales Extend Slide, Capping Worst Annual Drop Since 2008(excerpt)

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