September 2023 MBS Highway Housing Index

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John Smith
January 1, 2023
5 min read

Seasonal slowdown gathers pace; underlying demand remains robust.

MBS Highway’s September 2023 Housing Survey noted a significant drop in buyer activity levels and the pace of sales compared to August 2023. While this is to be expected due to normal seasonality, 7%+ mortgage rates and low inventory levels have clearly exerted a drag on transaction activity. Still, buyer activity is about the same as last year, and competition levels are much higher. The Mid-Atlantic and Northeast regions remain hot, while the Midwest region has cooled somewhat.

44% of nationwide respondents in September 2023 characterized their local buyer activity as ‘Very Active’, ‘Somewhat Active’, or ‘Steady’. That was a significant drop from 55% in August 2023, but was modestly higher than the 41% seen in September 2022.

In September 2023, 36% of nationwide survey respondents said that homes were ‘Selling Quickly with Multiple Offers’ in their area. That was a large decrease from the 46% seen in August 2023 and 54% seen in July 2023. That said, the same figure was just 12% in September 2022.

37% of nationwide respondents reported ‘Moderate’ or ‘Significant’ price decreases in September 2023. While that was a sizable increase from 28% in August 2023, that same figure was 67% in September 2022. On the other hand, 34% of nationwide respondents said that they were still seeing ‘Moderate’ or ‘Significant’ price increases in September 2023. That compares to 43% last month and just 10% a year ago.

Looking at the regional results, buyer activity dropped everywhere except the Northeast, with a survey record 79% of respondents indicating that buyer activity was ‘Very Active’, ‘Somewhat Active’, or ‘Steady’. That same figure in the Northwest region plunged from 54% in August 2023 to just 26% in September 2023. Meanwhile, the West region continues its strong recovery. In September 2022, just 4% of respondents said that they were seeing price increases. That figure had risen to 40% in September 2023.

“Transaction activity is slowing and the prevalence of price reductions is increasing. But don’t judge a book by its cover: most of this is normal seasonality. In fact, the level of activity and competition that our customers are seeing despite high rates/low inventory speaks to the robust level of intrinsic demand. And make no mistake, on a seasonally-adjusted, like-for-like basis, home prices are rising month-over-month,” said Barry Habib, MBS Highway Founder and CEO.

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