While January Home Price Growth Edged Up Nationally, West Coast Saw Red

• Homebuyers are in the strongest position in years
• Supply of homes for sale grows at fastest rate since May 2015

he housing market started off 2019 with buyers in a much better position than they were a year earlier, according to a report from Redfin, (www.redfin.com), the next-generation real estate brokerage. U.S. home-sale prices increased 2.9 percent in January compared to a year ago, to a median of $285,900 across the metros Redfin tracks. Albeit slight, last month’s price jump represents a rebound from December’s 1.5 percent increase, the smallest year-over-year price increase recorded since March 2012.

“Things are looking good for buyers in 2019. The supply of homes for sale is increasing faster than it has  in nearly four years,” said Redfin chief economist Daryl Fairweather. “December was a rough month for home sales, but homeowners appear to be undeterred in the new year as more are listing their homes for sale. We predicted price growth would slow down and that prices would drop in coastal cities like San Francisco and Seattle, but we didn’t know how sellers would react to a cooler market. It’s encouraging to see that listings are up–it means that sellers aren’t taking the ball and going home.”

Home prices fell year over year in 10 of the 81 largest metro areas Redfin tracks, including San Francisco (-5.0%) and Portland, Oregon (-1.3%). This is a major shift for two markets that consistently posted strong price growth throughout most of 2018 and where prices haven’t declined significantly since 2012. In Seattle, prices were still growing last month, but barely, up just 0.6 percent year over year, and seem to be following a similar trajectory as their West Coast counterparts.

Completed home sales nationally fell for the sixth consecutive month in January, down 7.6 percent from a year earlier. Home sales declined in 57 of the 81 largest metro areas that Redfin tracks.

The number of homes newly listed for sale in January rose from a year earlier (+4.4%), helping to push the total number of homes for sale up 6.3 percent, the biggest supply increase since May of 2015.

“We expect the supply of homes for sale to increase, giving buyers more homes to buy, but not so many that prices drop broadly,” said CEO Glenn Kelman during Redfin’s earnings call last week.