The latest Market Pulse Report from HouseCanary, which employs a range of metrics obtained from their nationwide platform, has been published for the period spanning from March 2022 to March 2023.
HouseCanary notes that despite the Federal Reserve implementing continuous rate hikes throughout the year and the impacts of three bank failures, there has been a significant decline in market activity in terms of contract volume and net new listing volume when compared to the previous year. Additionally, the numbers for net new listings are lower than those for contract volume, which has further contributed to the decrease in inventory numbers.
As we enter the second quarter of 2023 in April, the growth of the real estate market hinges on two crucial factors: whether the Federal Reserve will persist with its rate hikes to tackle inflation, and how consumer confidence will fare following the occurrence of three significant bank failures. These events could potentially lead to a reduction in demand from prospective home buyers, and consequently, affect future market statistics.
Jeremy Sicklick, the CEO and Co-Founder of HouseCanary, provided his insights on the current state of the real estate market. According to him, the recent collapse of three banks in March, coupled with further rate hikes by the Federal Reserve, may have significant consequences for mortgage rates as we approach the spring buying season. Their latest data highlights that a year of continuous rate hikes has already had a significant impact on housing market activity, with both net new listing volume and contract volume experiencing a sharp decline year-over-year. However, the data also shows that prices had stabilized in March, and single-family home prices have risen in many markets, suggesting that the market is gradually adjusting to the ongoing rate hikes. Nevertheless, consumer concerns about additional financial system issues could potentially have an unfavorable impact in the coming months.