Current inventories are now 13.4% lower than this time last year, closer to the 6-month supply recognized as a balanced market with an equal number of buyers and sellers, according to the latest RE/MAX Housing Report.
RE/MAX reported home sales and prices in September were lower than August, but remained significantly higher than September last year, making September the 20th consecutive month for year-over-year increases in both sales and prices.
September home sales were up 10.7% and the median price of $185,000 was 12.2% above the price in September 2012. With the current rate of sales, the number of months required to sell the entire inventory of homes on the market moved up to 5.0. This is closer to the 6-month supply recognized as a balanced market.
“It’s normal for the housing market to slow down a bit after the peak summer season, but it’s really encouraging to see that both sales and prices remain significantly higher than this time last year,” said Margaret Kelly, RE/MAX CEO. “The strong performance we saw this summer and throughout 2013 confirms we’ve passed the early stages of a housing recovery and are now moving toward a sustainable marketplace.”
The September RE/MAX National Housing Report showed an 18.5% decrease in Closed Transactions from August, but a 10.7% increase over September 2012. This makes September the 27th consecutive month RE/MAX reported higher sales than the same month in the previous year. After a strong summer season with sales peaking in May and July, lower numbers in September appear to be following seasonal trends. Of the 52 metro areas surveyed in September, 47 reported higher sales than September 2012, with 34 reporting double-digit gains, including: Chicago, IL +27.6%, Boston, MA +20.7%, Anchorage, AK +19.9%, Kansas City, MO +19.3%, Wichita, KS +19.1%, and Des Moines, IA +18.9%.
The median price of all homes sold in September was $185,000, a drop of 1.7% from the Median Price in August, but still 12.2% higher than the median price in September 2012. September becomes the 20th consecutive month with a median price higher than the same month of the previous year. Median price increases can be tied directly to the market’s low inventory and strong buyer demand. Of the 52 metro areas surveyed in September, 46 experienced higher sales prices than one year ago. Of those, 19 metro areas reported double-digit increases, including: Detroit, MI +44.4%, Atlanta, GA +36.0%, Las Vegas, NV +30.5%, San Francisco, CA + 28.5%, Miami, FL +24.4%, and Orlando, FL +24.3%.
Of all the homes sold in the 52 metro areas surveyed in September, the average number of days on market was 65, which is 3 days higher than the average in August, but 16 days lower than the average of September 2012. The September 65-day average marks the 16th consecutive month with a days on market average below 90. A low days on market average is the direct result of a reduced inventory of homes for sale and high buyer demand. Days on market is the number of days between when a home is first listed in an MLS and when a sales contract is signed.
For six consecutive months, inventory has declined at a slower rate than during the same month of the previous year. In September, there were 1.4% fewer homes for sale than in August, and 13.4% fewer than in September 2012. Inventory levels appear to be moving toward stabilization. In September, 14 metro areas saw inventories increase over August. At the current rate of home sales, the months supply for September was 5.0. Extremely low months supply remain in some key markets such as: San Francisco, CA 1.6, Los Angeles, CA 2.5, Denver, CO 2.5, San Diego, CA 2.9, Boston, MA 2.9, Honolulu, HI 3.0, and Washington, DC 3.1.