Jan 30, 2023 - News

Housing market is resurrecting

Illustration of a zombie's hand emerging from a grave, clutching keys.

Millennials, grab those keys. Illustration: Shoshana Gordon/Axios

The housing market is showing signs of life after veering into a dead zone late last year.

Driving the news: Pending home sales were up 3% nationwide in December, according to Redfin's proprietary measure.

Why it matters: These green shoots are a good sign for the economy overall, and run counter to some of the dire predictions made last fall.

  • Home buyers are making peace with higher mortgage rates, and sellers are making peace with the need to cut prices.

Between the lines: Mortgage rates are dropping. Rates peaked at over 7% in November but have dropped to an average rate of 6.13% on a 30-year mortgage, per Freddie Mac data from last week.

  • That's the lowest level since mid-September.

Zoom in: Dallas-Fort Worth remains a top destination for out-of-state buyers looking to relocate to a cheaper market.

  • Dallas ranked sixth among markets home buyers moved into, ahead of Houston. Unsurprisingly, more new residents came from California than anywhere else.

The intrigue: Dallas proper had a larger drop in home prices compared with neighboring cities, according to Redfin data.

  • House prices were down 11.5% in Dallas in December compared with the previous year. Fort Worth house prices, however, were up 3.9% in December.

What they're saying: Managers of Arlington-based homebuilder D.R. Horton expressed optimism over the 2023 housing market after declining demand last year, per the DMN.

  • "I do think the credit markets have stabilized somewhat, consumer confidence improved a little bit, job growth continues to be very good," CEO David Auld said during an earnings call last week.

The bottom line: Home buyers and sellers have adjusted their expectations. What once seemed high now seems like sort of a deal.


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