New Hampshire real estate ahead of national housing market trends

• Nationally homes haven't been this unaffordable in the USA since 1989, a 33-year low. However, an increase in inventory and stabilizing mortgage rates may stem this tide.

• The average monthly mortgage payment jumped 54% year over year in June, while the median household income rose only 5.8%, according to the National Association of Realtors®' affordability index.

• Nationally the average monthly mortgage payment rose to $1,944 in June from $1,265 a year earlier, a $679 difference according to NAR.

• Home prices declined nationally by 0.77% from June to July. According to Black Knight, an analytics firm, the first monthly decline in nearly 3 years. The drop is the largest single-month decline in prices since January 2011. Black Knight indicated that "further price corrections are likely on the horizon as we move into what are typically more neutral seasonal months for the housing market."

• Some local markets are seeing steep price declines over the last few months. San Jose, California, saw the largest, with home prices down 10%, Seattle down 7.7%, San Francisco down 7.4%, San Diego down 5.6%, Los Angeles down 4.3%, and Denver down 4.2%, according to Black Knight.

• Pending home sales dropped 19.9% in July compared with July 2021. It slipped only 1% in July, showing some relief from the recent short retreat in mortgage rates. NAR also indicated that "inventories are growing for homes in the upper price ranges, but limited supply at lower price points is hindering transaction activity."

• The average interest rate for a 30-year fixed rate mortgage with a conforming loan balance increased on Wednesday to 5.65% from 5.45%. Conventional applications declined 2%; however, government applications increased 4% — a sign that first-time home buyers may be slowly returning.

• Have you noticed that different media outlets are broadcasting that we're in a "housing recession?' It seems reporters are passing the same football down the field to create fear in the marketplace. Homebuilders are saying this because the national association of Home Builders Housing Market Index dropped 6 points to 49, and anything below 50 is considered negative. This is the eighth straight decline in the index. Recently Lawrence Yum, the economist for NAR, said, "we're witnessing a housing recession in terms of declining home sales and home building." However, he clarifies it by saying, "it's not a recession in home prices, nationally with nearly 4% of homes still commanding the full list price, but there are signs the market is starting to shift in the buyer's favor."

• Nationally sales of existing homes were down in July by 20.2% to $4.8 million properties from $6 million a year earlier, according to NAR. However, the median price last month was $403,800, up 10.8% from July 2021.

So how do the national home statistics above compare to what's happening in New Hampshire?

• The state of New Hampshire's single-family median sales price was up 11.1% from July 2021 to $450,000. This number is down just a bit from June's statewide average of $460,000. However, New Hampshire's average of $450,000 is higher than the national average of $403,800.

• There were only 1,477 single-family sales last month, a 7.3% drop from June 2021. This was the lowest number of homes sold in July since 2012, when New Hampshire was pulling itself out of the great recession.

• So far this year, there have been 7,701 single-family sales in New Hampshire at a median sales price of $445,000. That's a 15% drop in sales year over year. However, the median sales price increased by 14.8%.

• Homes are still selling quickly. The New Hampshire Association of Realtors® said the average number of days on the market sunk 5.9% to 16 days in July, up only a bit from the 13 days in June.

• Year-to-date total new listings are off 2021s amount by 9.1%. The total inventory was 2,337 homes in July compared to 2,445 in July 2021. However, June to July showed a 13% increase in inventory. Hopefully, this will start a shift where home prices will moderate.

• We are still seeing some bidding wars where above asking price offers get accepted. Statewide it is reported that the average single-family home has been selling for 103.4% of the listing price in July.

• As of Wednesday, August 24th, there are 1,929 single-family homes for sale in New Hampshire. This is a considerable increase considering the low inventory levels we experienced in early spring.

In the Lakes Region, there's been a strong demand for waterfront property, water access communities, view properties, and condominiums. Everyone is looking for sandy beaches, boat slips, views of the lakes or mountains. Good listings that fit these categories get snapped up quickly, and there is still an undersupply of inventory. Fortunately, we are beginning to see signs of new products coming on the market, and we're seeing certain properties with price reductions that were priced too aggressively. I expect the market to moderate over the winter months, and the market will become more favorable for buyers. The Federal Reserve is on a mission to reduce inflation, and the housing sector is a major component.

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This article was written by Frank Roche. Frank is president of Roche Realty Group with offices in Meredith and Laconia, NH, and can be reached at 603-279-7046. Please feel free to visit www.rocherealty.com to learn more about the Lakes Region and its real estate market.