In the Kansas City, MO market, new home closings fell year-over-year in January, but with a percentage decline less steep than December 2015, there are hints the market may be stabilizing. There was a 14.0% drop in new home closings from a year earlier. This followed a 22.4% fall year-over-year in December.
A total of 2,370 new homes were sold during the 12 months that ended in January, down from 2,388 for the year that ended in December.
As a percentage of overall housing closings, new home closings represented 3.3% of overall housing closings. A year ago, new home closings made up 4.3%. After remaining steady in December from a year earlier, closings of new and existing homes jumped in January.
Pricing and Mortgage Trends
The average price of new homes was $382,382 per unit in January, up 10.8%from a year earlier. This gain is higher than the 5.2% surge in December year-over-year.
The average mortgage size on newly sold homes grew year-over-year along with the average price of new homes. The average mortgage size rose to $317,841 in January, marking a 10.3% lift compared with a year earlier. Average mortgage size climbed 4.8% in December 2015 from a year earlier.
Other Market Trends
As a share of new home closings, single-family home closings have climbed from last year while the share belonging to attached units has fallen. Single-family home closings increased from 96.9% of new closings in January 2015 to 98.2% of closings in January 2016. At the same time, the share of new home closings belonging to attached units slid to 1.8% of closings from 3.1% of closings.
For all new homes sold, the average unit size dropped 8.5% year-over-year to 2,204 square feet in January 2016. For newly sold homes, an average size fall contrasting with an average price lift was also seen in December 2015 when the average size of newly sold homes fell 14.6% to 2,214 square feet. The average size of newly sold homes moved from 2,592 square feet in December 2014 to 2,214 square feet in December 2015.
Foreclosures and real estate owned (REO) closings continued to increase in January from a year earlier and stayed a drag on the market. Together, foreclosures plus REO closings accounted for 31.3% of existing home closings, up from 28.8% a year earlier. The percentage of existing home closings involving foreclosures rose to 21.3% in January from 12.5% a year earlier while REO closings as a percentage of existing home closings dropped to 10.0% from 16.3% a year earlier.