Phoenix among 5 markets with biggest home price decrease
The housing market decelerated throughout 2022 creating more opportunities for homebuyers, in stark reversal of the frenzied seller's market of the previous year, according to the RE/MAX® National Housing Report for December 2022. The year's most telling stats were punctuated in December: Home sales were down 38% from a year ago while the number of homes for sale was up 69% in the report's 53 metro areas. And Phoenix was in the mix, ranking No. 5 for the biggest year-over-year home price decrease and No. 2 for biggest increase in listings.
Sales in every month of 2022 fell short of the previous year, with the percentage of decline starting out in single digits during the first quarter before topping 30% in the fourth quarter. The Median Sales Price of $385,000 was 1.3% higher year over year in December, compared to 13.9% higher year over year last January.
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"The past three years have each had a unique context – and 2022's included quickly rising interest rates and the difficult year-over-year comparisons to the extremes of 2021. Ultimately, though, it was a fairly good year for home sales by historical standards," said Nick Bailey, RE/MAX President and CEO. "Looking forward into 2023, the higher-interest rate environment clearly poses some challenges – but as buyers, sellers and agents recalibrate their expectations, sales will continue to occur. Demand hasn't gone away. The question is which real estate professionals have the skills, experience, resources and adaptability to provide the guidance consumers will continue to need.
"As strong believers in the advantages of homeownership, we think the ongoing market rebalance is actually a good thing. It's putting buyers and sellers on more equal footing, which is refreshing after so many years of sellers having the upper hand. Sellers still have a strong position, but buyers are gaining more power in what's likely one of the largest financial transactions of their lives. With mortgage rates and home prices appearing to stabilize, and with the dramatic increase we've seen in the number of homes for sale, both buyers and sellers have reason to be optimistic as we head into the new year."
Mark Wolfe, Broker/Owner of RE/MAX DFW Associates in Coppell, TX expects the market to continue to improve over time.
"We saw the beginning of some stabilization at the end of 2022, and I am hopeful we are reaching a normal market."
As in October and November, the average Close-to-List Price Ratio in December was 98%, meaning that homes sold, on average, for 2% less than the asking price. The ratio peaked at 103% in April and May compared to 100% in December 2021.
December inventory was down 12.2% from November but grew month-to-month in six of the last nine months.
Other notable metrics include:
- New listings recorded 2022's largest month-to-month decline of 25.2% and finished 15.1% lower than a year ago.
- Homes sold in December were on the market for an average of 47 days. That was 10 more days than one year ago.
- December's 2.5 months supply of inventory was unchanged from November but more than double the 1.2 of one year ago.
Highlights and local market metrics for December include:
Median Sales Price – Phoenix sees big home price decrease
In December 2022, the median of all 53 metro area sales prices was $385,000, down 2.3% compared to November 2022, and up 1.3% from December 2021. The markets with the biggest year-over-year decrease in median sales price were San Francisco, CA at -5.1%, Los Angeles, CA at -4.7%, and Honolulu, HI at -4.3%. Four metro areas increased year-over-year by double-digit percentages, Manchester, NH at +17.7%, Fayetteville, AR at +12.3%, Indianapolis, IN at +11.8%, and Omaha, NE at +10.2%.
Of the 53 metro areas surveyed in December 2022, the number of newly listed homes is down 25.2% compared to November 2022, and down 15.1% compared to December 2021. The markets with the biggest decrease in year-over-year new listings percentage were Des Moines, IA at -43.6%, Phoenix, AZ at -39.7%, and Los Angeles, CA at -38.6%. Leading the year-over-year new listings percentage increase were Trenton, NJ at +44.2%, Philadelphia, PA at +39.9%, and Dover, DE at +38.3%.