B4 • Friday, February 25, 2022
THE GARDEN ISLAND
thegardenisland.com
HOUSING SUPPLY AT RECORD LOW January home sales rise ahead of expected rate hikes Alex Veiga ASSOCIATED PRESS LOS ANGELES — Sales of previously occupied homes rose in January as a surge in buyers with cash and others eager to avoid higher mortgage rates snapped up properties, leaving the number of available houses on the market at a record low. Existing home sales rose 6.7% last month from December to a seasonally adjusted annual rate of 6.5 million, the National Association of Realtors said Friday. That’s more than the roughly 6.08 million sales that economists had been expecting, according to FactSet. Sales slipped 2.3% from January 2021 as the median home price jumped 15.4% from last year at this time, to $350,300. Those prices are being driven higher with so many potential buyers hunting for a shrinking number of properties still on the market. The number of homes for sale at the end of January totaled just 860,000 — the fewest since the NAR began tracking it in 1999, and there are few signs that pressure will let up soon. The inventory of unsold homes fell 2.3% from December and 16.5% from a year
demic, higher prices and rising interest rates will make it even harder for house hunters this spring to secure a new home. Average long-term U.S. mortgage rates rose this week, approaching levels not seen since 2019. The average rate on a 30-year loan reached 3.92%, up from 3.69% the previous week, according to mortgage buyer Freddie Mac. The last time the 30-year rate was higher was in May of 2019 when it reached 3.99%. Historically low mortgage rates last year helped give would-be homeowners buying power as prices soared. Now rates are expected to rise as the Federal Reserve moves to fight inflation by raising its short-term interest rate and winding down its bond purchases that helped keep long-term interGENE J. PUSKAR / ASSOCIATED PRESS FILE est rates low. The rapid-fire sales occurThis is a home for sale in Mount Lebanon, Pa., on Tuesday, Sept. 21, 2021. ring now could loose molast month. That’s not quite Department. But many more mentum just because prices ago. At the current sales tors and homebuyers who as fast as the summer, when homes need to be built. A re- are rising so fast and there pace, that amounts to a recan afford to outbid other 17 days was the norm. In a cord low 1.6 months’ supply, would-be buyers with cash. cent analysis by Realtor.com are so few homes to choose Some 27% of home sales last market that’s more evenly from, said Nancy Vanden the NAR said. found the shortage of new Houten, lead U.S. economist While it’s normal for fewer month were all-cash transac- balanced between buyers homes relative to new and sellers, homes typically households has swelled to at Oxford Economics. homes to go on sale in the tions, the NAR said. A year “Resilient demand and months leading up to the an- ago they made up only 19%. remain on the market 45 nearly 6 million homes. days. strong income gains will unHousing market demand Real estate investors acnual spring homebuying seaHomebuilders have looks to remain healthy this derpin the housing market, son, the ultra-low level of counted for 22% of transacstepped up to put up more year, bolstered by ongoing properties on the market but limited supply and detions in January, up from new homes in response to demographic change as continues to give sellers a 15% a year ago. First-time clining affordability from big edge on buyers. buyers, meanwhile, made up the red hot housing demand. younger millennials and Gen- both higher prices and Nearly 1.6 million housing Zers come of age and look to sharply higher mortgage The combination of rising 27% of all homes sold last units were started in 2021, a become homeowners. But home prices and a dearth of month. rates will constrain the pace homes on the market has On average, homes sold in 15.6% increase over 2020, ac- with housing in short supply of sales,” Vanden Houten since well before the panalso given a leg up to inves19 days of hitting the market cording to the Commerce said.
US mortgage rates tick down to 3.89% this week ASSOCIATED PRESS WASHINGTON — Average longterm U.S. mortgage rates fell slightly this week, after rising to their highest level in three years last week. The average rate on a 30-year loan declined to 3.89% this week from 3.92% the previous week, mortgage buyer Freddie Mac reported Thursday. A year ago, the long-term rate was 2.97%. The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, ticked down to 3.14% from 3.15% one week earlier. It stood at 2.34% a year ago. The Federal Reserve has signaled that it would begin the first in a series of interest rate hikes in March, reversing pandemic-era policies that have fueled hiring and growth but also contributing to inflation levels not seen since the early 1980s. The Labor Department reported earlier this month that consumer prices jumped 7.5% last month compared with 12 months earlier, the steepest year-over-year increase since February 1982. Higher costs for nearly everything have wiped out Americans’ pay raises, reinforcing the Federal Reserve’s decision to begin raising borrowing rates across the economy. Home prices are up even more, climbing about 14% in the past year and as much as 30% in some cities. Available housing has been limited since before the pandemic began in 2020, and higher prices and rising interest rates will make securing a new home even harder.
A trusted source in the Real Estate industry for our members, our community and those that we serve. The Kauai Board of REALTORS (KBR) is committed to being the “Voice” for real estate and real property owners on the island of Kauai. As an organization, KBR closely tracks Federal, State and County Council Bills and Ordinances as it relates to housing and infrastructure, while also submitting testimony for upcoming Council Policies and Bills. KBR also takes pride in educating its membership and the Community relating to the new Ordinances and the legislative process like: How a Bill Becomes an Ordinance (County); Discover Your “Voice” in the Legislative Process (State); Understanding the Residential Investor Tax (County); Shoreline Setback and Sea Level Rise and Coastal Erosion (County & State impacts). Aside from advocating for homeownership, the Kauai Board of REALTORS are committed to helping our community through various outreach programs. This year, we held a “College is Possible” event to help high school and middle school students and parents understand that College isn’t as far out of reach as many people think. In addition, KBR held a Clothing Drive in partnership with Women In Need (WIN), YWCA and Nana’s House which turned out to be a huge success. Looking forward to the remainder of the year, our members are excited to participate in our beach clean up; the School Supply Drive with Kukui Grove Shopping Center and Habitat for Humanity’s Build Day. We look forward to providing more educational programs as our County Council moves forward in the legislative process as well as additional outreach programs to help our community. 808-245-4049 4359 Kukui Grove St., #103, Lihue HI, 96766 www.kauaiboard.com