The pickings are still pretty slim for homebuyers, but that may be starting to change.
The local housing market, which was sizzling last summer, cooled a bit during January, as it usually does as winter takes hold, new data from the Buffalo Niagara Association of Realtors shows.
While the same underpinnings that have shaped the housing market for the past two years remain in place, the shortage of listings is beginning to ease, with the number of homes coming on the market rising during two of the last three months.
Even so, it’s not a huge change. The number of homes for sale is still at close to a 20-year low, creating competition for well-kept homes in desirable neighborhoods. With demand high and mortgage rates still under 5 percent, homes continue to sell quickly, although the real estate group thinks the shortage of available homes may ease a bit.
“Early signs point to an improving inventory situation,” the group said in its report. “Many new listings enter the market immediately after the turn of a calendar year.”
Median sale prices have come down from the all-time highs that they hit in late spring last year, but the overall trend in prices continues to be upward, albeit more slowly.
Even with homes in short supply, home prices were affected by seasonal softness in January, with the median sale price rising to $145,000, which is up 4 percent from a year ago, but down from the record highs of more than $160,000 that were set in late spring. That’s not unusual. Sale prices typically slide from their peak selling season highs as the winter settles in.
With buyers scrambling for an unusually small supply of homes, the pace of home sales has slowed slightly for two straight years. After falling by a little less than 2 percent during 2017, home sales dropped by 2.1 percent last year, based on revised data from the real estate trade group.
The trend continued into January, with sales over the preceding 12 months down by 3.4 percent. However, that decline is likely to be revised downward when the January sales data is updated next month to include late-reported sales.
The biggest factor shaping the Buffalo Niagara housing market is the lack of homes for sale, but there was a small sign during January that the shortage may be starting to ease. The number of homes for sale grew by 2 percent last month – the first year-over-year increase in inventory since February 2016.
New listings, which were down 4 percent last year, also have been creeping higher, rising during three of the last six months, including a nearly 9 percent increase during January. Even so, there were only 2,585 homes for sale at the end of January, and less than half as many as were on the market in January 2012.
Homes still are selling briskly in a market with low inventory and mortgage rates still relatively low. The average home that sold during January was on the market for 44 days. That’s five days less than during January 2018 and 2½ weeks faster than they were selling just two years ago.
With demand still strong, home sellers still are able to hold fairly firm to their asking price. The average home that sold last month went for 97.7 percent of its most recent asking price.