Home buying in the Mid-Atlantic region stalled in February as rising mortgage rates and higher prices due to a lack of inventory cut into home shoppers’ buying power.
According to the Bright MLS February Housing Market Report, this sets the stage for a bumpy ride into the spring housing market. The Bright MLS report includes sales activity for the New Jersey counties of Mercer, Burlington, Gloucester and Camden as part of its assessment of real estate conditions in the Philadelphia, Baltimore and Washington, D.C. metro areas.
Pending sales and new listings increased month-over-month, as is typical leading into the spring homebuying season, however, these upticks were smaller than in past years. Viewed on a year-over-year basis, pending sales (-22%) were at their lowest level since 2015 and new listings (-27.4%) compared to February 2022 hit a more than 20-year low in the Mid-Atlantic region.
Bright MLS’s local market data shows that compared to February of 2022, closed sales declined 32.4% in Mercer County, 25.2% in Burlington County, 22.9% in Camden County, and 13.7% in Gloucester County. New listings were down 34.1% in Mercer County, 22.1% in Camden County, 18.3% in Burlington County and 7% in Gloucester County over the same 12-month time period.
In the more forward-looking number of home showings category, the report found that fewer people were looking compared to February of 2022. Showings were down 32.5% in Mercer County, 26.5% in Gloucester County, 17.3% in Camden County, 16.3% in Burlington County.
Higher mortgage rates and economic uncertainty have subdued the ramp up to the spring market across much of the Mid-Atlantic, said Bright MLS Chief Economist Dr. Lisa Sturtevant.
“Both rising interest rates and lack of inventory, which are keeping home prices from falling, have sidelined many prospective buyers, especially those looking to purchase their first home,” Sturtevant said. “With more evidence rates are going to rise in the coming months and little incentive for homeowners with sub-3% mortgage rates to sell, buyers and sellers should brace themselves for a bumpy ride this spring homebuying season.”