Fewer houses getting sold helped gains in inventory and brought down the rate of sales price growth to wrap up 2018, according to Redfin.
December’s home-sale prices increased 1.2% year-over-year, representing the smallest annual growth since March 2012. It’s also a month-over-month decline of 1.6%. The median sales price now sits at $289,800.
While prices came down in the overall housing market, the top 5% had larger declines in value than the rest. Of the 76 largest housing markets in the country, nine had negative year-over-year price growth, led by Honolulu, at 9%, San Jose, Calif., at 7.3%, and Bridgeport, Conn., at 5.4%.
“December may feel like a foot on the brake, but the housing market was going over the speed limit,” Daryl Fairweather, Redfin’s chief economist, said in a press release. “Home prices have been growing faster than wages since 2012, and that can’t go on forever. Now that price growth has slowed down and more homes are sitting on the market, buyers will have the upper hand in 2019.”
There were 205,300 homes sold in December, decreases of 10.9% year-over-year and 6.9% month-over-month. The drop in sales led to a 4.8% annual increase to 669,600 available homes on the market.
“Buyers will have more options with more homes for sale, and it will be sellers working to woo buyers into making an offer. And as a bonus, buyers, for the time being, have the benefit of mortgage interest rates that are lower than they were in late 2018, which will make borrowing more affordable,” Fairweather continued.
Nearly 61% of the metro areas saw increased for-sale inventory compared to a year ago. San Jose set the pace, at 131.3%, while Seattle, at 117.8%, and Oakland, Calif., at 69%, followed.
“Buyers shopping now are benefiting from sellers who are willing to negotiate, since it’s anyone’s guess what the spring real estate market will look like,” said Seattle-based Redfin agent Jessie Culbert. “Well-priced, appealing homes are seeing the return of pre-inspections and even multiple offer situations, so it may be too soon to get comfortable with the idea of a slower market.”