US housing sales have plummeted 25 percent since 2022
Over the last year, the number of homes sold in the US has fallen by a quarter. Which states have seen the most significant declines?
As interest rates have reached unprecedented levels, the number of homes sold in the United States has drastically decreased. According to Zillow, in October, only 306,412 homes were sold, which is a twenty-five percent drop from the sales recorded in the same month in 2022. Throughout 2023, the number of homes sold has varied from a high of 381,050 in June to a low of 215,304 in January. As of 30 November, the average interest rates for 15-year and 30-year mortgages stood at 6.56 percent and 7.22 percent, respectively.
Although these rates had slightly decreased from a few weeks earlier, they were still significantly higher than the rates observed over the past ten years. During a recent event at Spelman College, Fed Chair Jerome Powell said that while there are indications that “restrictive” monetary policy has brought inflation down, the leader said that it would be “premature” to assume that said policies will soon ease. Chair Powell added that the central bank is “prepared to tighten policy further if it becomes appropriate to do so.”
As a result of the high interest rate environment, many potential homebuyers have been priced out of the market, causing the number of homes sold to decline. Although the number of homes sold has started to increase, it is still lower than the pre-pandemic averages. For instance, in October 2019, 419,246 homes were sold, significantly higher than the pace seen after the Federal Reserve began to increase interest rates.
States that have seen the greatest decrease in homes sold
While the number of homes sold has decreased in all states since 2022, the degree to which this decline has been felt varies across the county. Kansas, with a 38 percent decrease, has seen the sharpest drop, followed by:
The average home price in Kansas rose by two percent over the last year, according to data from Redfin. The largest increase of states on the list was Maryland with average prices of homes sold surging 5.7 percent. However, not all states saw property values appreciate, with Oregon and Hawaii observing a decrease of just under one percent.