Pending sales in up in January compared to 2019

CAPITAL REGION, N.Y. » Pending and closed residential real estate sales increased last month in the Capital Region compared to January 2019, offering a nice surprise for what is usually the slowest month of the year, according to The Greater Capital Association of Realtors.

Pending sales increased 6.4 percent from January 2019 to 844 for the month, and closed sales increased nine percent from January 2019 to 809 for the month in the region, the report said.

The low mortgage rate environment continues to spur home buying activity, according to mortgage loan company Freddie Mac, with applications to purchase a home up 15 percent from a year ago.

Nationally, there’s been a new residential construction surge over the last few months, on pace to reach the highest level in more than a decade.

“This is a good sign for the inventory-starved housing market and is a promising indication for the spring home buying season,” a press release from the Greater Capital Association of Realtors stated.

However, inventory levels are still down market-wide. The report said that months’ supply of homes fell by 19.2 percent to 4.2 months impacting the inventory of homes for sale to decline by nearly 20 percent to 4,565 homes.

New listings in the Albany region decreased 5.6 percent to 1,286.

Changing that narrative has proven to be a challenge in recent years. Greater Capital Association of Realtors president, Tom McGroder, Thomas J Real Estate, believes new construction is part of the solution for a market facing inventory concerns. “More sellers need to enter the market or more homes need to be built, it’s as simple as that,” he said in the release.

As a result of the decreased inventory, January’s prices were up compared to this time last year. The median sales price increased 2.5 percent to $205,000.

In Albany County, where the median home price is $230,000, new listings were down but closed sales increased, compared to January 2019.

Across the river in Rensselaer County closed sales also increased, and the median home price increased to $197,000. In the city of Troy, where closed sales were down significantly, that number is $137,000.

Saratoga County’s median home price dropped slightly to $278,100. New listing and closed sales were both lower than the January prior. For the city of Saratoga Springs, the median home price was $305,000.

Price increases are anticipated again this year in the Capital Region, but buyers are not expected to blindly pay prices that put their ability to live a healthy financial life in jeopardy, the report said.

Home affordability will continue to set the tone for the 2020 housing market, it continued. The housing affordability index increased 6.9 percent. This indicates that homebuyers are able to afford the rising home prices.

For 2020, The National Association of REALTORS® Chief Economist Lawrence Yun sees good news for home prices. “National median home price growth is in no danger of falling due to inventory shortages and will rise by 4%,” the long-term NAR economist predicted in the release. He is also expecting the newhome construction market sales to increase 10%. Yun and others would like to see home builders bring more affordable units to market to help ease shortages and slow price gains in that segment.

“We start off the year with continued low interest rates, low unemployment, and rising rents nationally,” the report said. “These factors should encourage healthy buyer demand and sets us up for a strong start to the 2020 housing market and a lot of optimism for the coming spring market.”