Housing demand in January hit its highest point in four years. According to the latest Redfin Housing Demand Index report, January demand increased 6.5 percent compared to December, hitting an adjusted level of 130.
Compared to a year earlier, homebuyer demand was up 23 percent in January. That number was led by a 26 percent year-over-year increase in homebuyers requesting tours and an 18 percent increase in buyers making offers, Redfin reported.
Baltimore showed the most marked uptick in demand, up 64 percent from a year earlier. The city’s Demand Index level hit157 in January. Boston recorded the highest index number, 174. That’s a nearly-35 percent increase compared to the same time last year.
Sandy Rosen, a Redfin agent in Boston, credited the spike in the way sellers are listing. Sellers are putting up houses at intentionally low prices, drawing 10 or 15 offers and then choosing from among the highest bidders, she said.
“A home that looks like an incredible deal when it first lists almost always sells for far above the list price,” she said.
A level of 100 represents the historical average for the three-year period from January 2013 to December 2015.
Redfin found that the number of homebuyers making offers increased 13 percent nationally, compared to December; the number of requests for home tours increased a more modest 3 percent. Chief economist Nela Richardson chalked both up to the bull market.
“Soaring stock markets, still low mortgage rates, and a steady economy bolstered homebuyers at the start of 2017,” Richardson said. “Homebuyers were not just window shopping, they were serious about making offers and getting to the closing table.”
Chris Calabretta, a Redfin agent in Baltimore, said most of his customers’ offers lately “have been part of a multiple offer situation, and the homes I’ve listed have found buyers as quickly as two days, and most within two weeks.” Renovated historical properties in particular, he said, are becoming increasingly popular.
The caveat, Richardson said, is that robust January numbers won’t guarantee strong sales in the coming months.
“With pending home sales down across the country in January despite strong demand, the lack of supply is a formidable foe for buyers this year,” she said.
The start of 2017 brought a notably limited selection for homebuyers, who saw 13.4 percent fewer homes on the market in January than the previous year, with 4.0 percent fewer new listings, the report found.