Our friends at the Cromford Report shared this great summary of what you can expect every year, regardless of how hot or cold the market is.

When people ask me the best time of the year to list or buy a home, I share a variation of this.

“We experienced a huge increase in demand during January, though this was from an extremely low level as of January 1.

The number of listings under contract rose from 5,456 to 7,810 an increase of 43%. This is by a wide margin the highest percentage increase we have ever measured from one month to the next. It shows us that buyers are getting used to interest rates around 6%. It helps a lot when sellers are willing to help them buy down the initial rate.

Pending listings increased almost 40% while UCB listings jumped over 50%.

It is time to drop the Skepticism and enter the Hope stage of the cycle. In most market cycles this diagram takes 3 to 5 years to pan out. However we have moved from Euphoria to Hope in just 1 year. I suppose this is the result of the increased speed of communication.

Listings are going under contract so quickly that the supply of new listings cannot keep up, despite a much higher flow of new listings than we saw in December. We are heading back towards a supply-constrained market and it is likely that prices will start to move higher within a short space of time. Asking prices are moving upwards quickly and these are usually a leading indicator.

While there is no guarantee that mortgage rates won’t go higher again, 2023 has started out much stronger than anyone expected back in November. This underscores why it is important to track the market daily, not just once a month.