I just read an interesting piece from HousingWire that really puts some perspective on where we stand right now in the housing market. On the surface, you see that inventory is down compared to last year and prices are growing at just two percent, which might sound concerning for folks worried about affordability. But here's the thing: the market is actually functioning pretty well at the moment.
According to HousingWire, we're sitting at about 1.54 million active homes on the market with roughly four and a half months of supply. That's actually within what experts consider a healthy range for a functioning marketplace. Yes, we're not back to the pre-pandemic levels we used to see, but what matters is that we have enough homes available so buyers have real options and sellers aren't sitting on property indefinitely.
The price growth picture is also more encouraging than people might realize. HousingWire points out that annual price appreciation is running between one and two percent nationally right now, which is significantly better than what we experienced in the years right after COVID. Think about it: we saw ten percent growth in 2020, nineteen percent in 2021, and even with sales crashing, six percent in 2022. By comparison, today's modest appreciation is actually allowing affordability to improve naturally, even without help from lower mortgage rates.
From HousingWire's reporting, existing home sales are up 2.4 percent year to date, and the data shows that demand performs best when mortgage rates sit closer to six percent. Right now rates are a bit higher, which does cool things down somewhat, but the market has proven it can hold steady even at these levels. Purchase applications are actually up three percent week to week, though they're down compared to last year, which HousingWire attributes to comparing against a period when rates were falling and pushing demand higher.
What I am seeing locally here in the Bay Area and across the East Bay mirrors these national trends. We've got enough inventory on the market that buyers aren't feeling completely boxed out, yet scarcity isn't so extreme that we're seeing the wild bidding wars we remember from a few years back. For sellers, it means you need to price competitively and present your home well, but for buyers, it means there's actually room to negotiate and be selective. That's a much healthier dynamic than what we've dealt with recently.
