The housing market has gone from one of the hottest in U.S. history to one that homeowners have begun to worry about. Price increases have slowed in some markets. In others, those increases have disappeared completely.
Until the past two months, the average price of an American home rose 20% a month year over year, according to the S&P Case Shiller price index. In some markets, such as Tampa, Miami and Phoenix, the number spiked as much as 30% by the same yardstick.
The slowdown has been primarily blamed on two factors. One is rising home loan rates. The interest rate on a 30-year fixed rate mortgage a year ago was under 3%. That has risen to over 4%, and in some cases 5%.
The slowdown also has been triggered by a decline in consumer confidence. Millions of Americans have started to worry about inflation. This anxiety has undermined the purchase of expensive items like houses and cars.
Some markets remain attractive for sellers. Among the best ways to identify these is how long it takes to sell a house. The so-called days to sell figure takes into account how long homes are on the market from when they are listed until when an offer is accepted, and it adds the days until the sale is completed.
When the home market was at its most frothy, some homes for sale would get several bids and might be on the market for just a few days.
An analysis of Zillow data by Tangerine shows that in several metros, days to close are below 47. The market where the process takes the least time is Seattle at 41.2 days. Several other markets in Washington state are also among those with fewest days to close. This includes Olympia (42.21) and Bremerton (43.6 days).
As mortgage rates rise and a recession takes hold, even these cities likely will find home purchase demand drops, and with it, days to sell will rise.
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