for the Eleventh Straight Month in December

• Existing-home sales tumbled 17.8% in 2022 from 2021, the biggest decline since 2008.
• Sales of existing homes fell 1.5% to 4.02 million annualized units in December from the prior month.
• Total housing inventory at the end of December was 970,000 units, down 13.4% from November.
• Sales of existing homes were down on a year-over-year basis in each of the four major U.S. regions.

Sales of existing homes fell 1.5% in December to 4.02 million annualized units, the slowest pace since 2010, from 4.08 million in the prior month, according to the National Association of Realtors. This means 4.02 million units would be sold in 2022 if sales were at the same pace as they were in December. Sales fell on the month in the Northeast, Midwest, and South while sales were flat in the West. Sales were down on a year-over-year basis in each of the four major regions for the eleventh straight month. Sales of existing homes registered at 5.03 million in 2022, down 17.8% from 2021. 

The median existing-home price for all housing types was $366,900, up 2.3% from December 2021 ($358,800). The median existing single-family home price was $372,700 up 2.0% from December 2021. The median existing condo price was $317,200, an annual increase of 3.3%. The months’ supply of existing homes for sale was 2.9 months in December at the current sales pace, down from 3.3 months in November but up from 1.7 months in December 2021. The National Association of Realtors considers a stable housing market to have six months of supply. Properties typically remained on the market for 26 days in December, up from 24 days in November and 19 days in December 2021. 

Existing-home sales declined for the eleventh consecutive month as high mortgage rates and deteriorating affordability weighed on housing activity in 2022. Housing inventory was low coming into the pandemic after many years of underbuilding following the Great Recession. But homebuilders have grappled with inflation, supply-chain disruptions, and labor constraints, putting downward pressure on the inventory of unsold existing homes. 

To fight inflation, the Fed embarked on an aggressive monetary policy cycle in March 2022, sending mortgage rates to the highest level since 2000. However, mortgage rates have declined slightly in recent months as inflation has moderated and recession fears have increased. As the Fed continues its hiking cycle, activity will decline further in interest-rate-sensitive sectors, particularly housing.