While January is never really a ‘bellweather’ for what’s to come later in the year (at least in terms of real estate), it does help to look to see what is different this year from last. And while a month is only one data point, seeing where that point falls on an extended line is at least interesting.
And sometimes you need to combine two or more points to get a better sense of what is happening underneath the raw numbers.
For example: you might notice that the number of homes listed this January jumped almost 13% from last January. Ok, that’s good - we’ve talked enough over the past 4 year about inventory shortages, so more homes is a good sign.
But the also look at the months of inventory - this also increased 13% from last January to this January. So that’s two points of data moving us in the same direction - higher inventory.
Now let’s also layer in the days on market. The time in the market increased 45% from one year to the next. Its worth noting that the sales in January are largely reflective of homes that went under contract on November and December. Generally they quietest time of the year.
Again, this is just one month - no need to call the Washington Post just yet. But all three indicators point to there being more choice for buyers, and more sellers coming into the market.
If we look out across the past 12 months, its worth pointing out that the number of new listings in January was a good bit higher than last February (335 vs. 287) and roughly equal to the new listings in August (334), September (352) and October 345). This would seem to indicate there are more sellers ready to get their homes on the market.
One word of caution for those sellers: the average sales price in January was at it’s lowest point in the past 12 months. Much of that is again due to seasonality, but seller should be aware that the upward ride of appreciation could be at its peak.
We’ll keep watch and see what next month’s numbers bear out…
