The US housing market began the year in a state of rebalance, with many buyers and sellers remaining cautious while they wait to see where the market is headed. Nationally, pending sales rose 2.5% month-to-month, marking the first increase since May, while sales of existing homes fell 1.5% as of last measure, according to the National Association of Realtors® (NAR). Demand for housing persists, but higher mortgage interest rates have cut into housing affordability, with total home sales down 17.8% last year compared to 2021.

New Listings increased 9.1 percent for single-family homes but remained flat for townhouse-condo properties. Pending Sales decreased 7.8 percent for singlefamily homes and 19.4 percent for townhouse-condo properties. Inventory increased 1.8 percent for single-family homes but decreased 3.4 percent for townhouse-condo properties. The Median Sales Price was up 6.3 percent to $420,000 for single-family homes and 31.3 percent to $362,000 for townhouse-condo properties. Days on Market decreased 10.5 percent for single-family homes but remained flat for townhouse-condo properties. Months Supply of Inventory increased 22.2 percent for detached homes but remained flat for townhouse-condo properties.

As sales slow, time on market is increasing, with the average home spending 26 days on market as of last measure, according to NAR. Seller concessions have made a comeback, giving buyers more time and negotiating power when shopping for a home. Although home prices remain high, mortgage rates declined steadily throughout January, falling to their lowest level since September, sparking a recent surge in mortgage demand. Lower rates should aid in affordability and may soon lead to an uptick in market activity ahead of the spring selling season.