Home Sales Increase 2.3% Despite Peaking Prices, Ever-Shrinking Inventory
Monday, May 21st, 2018
Home sales increased 2.3% year-over-year in April 2018 in the face of record low inventory and the second-highest median sales price in the nine-year history of the RE/MAX National Housing Report.
In April, San Francisco, CA reached a new benchmark surpassing $1 million for the metro area's median sales price. Eight other metro areas including Las Vegas, NV, Seattle, WA and Boise ID saw large double-digit price increases from just a year ago.
"If 2018 is like recent years, we're only two months away from home prices peaking — we're already seeing some impressive prices moving up in markets throughout the U.S.," said RE/MAX CEO Adam Contos. "As we head into summer, we'll watch several housing markers like home starts, mortgage applications and sales price to gauge the effect they'll have on inventory across the country — the good news is that the rate of sales helps accommodate a shrinking inventory and buyers can still find opportunities."
The $243,000 Median Sales Price was a record for April and was second only in report history to $245,000 in June 2017. In each of the last five years, June has produced the year's highest Median Sales Price, with July or August posting the second-highest monthly price each year.
Notable metrics from this month's RE/MAX National Housing Report:
Thirty-eight of the 53 markets in the report posted more sales than in April 2017, while the 2.5 months supply of inventory tied March as the lowest ever, in the history of the report
The average Days on Market in April was 52 — that's five days less than April 2017 and a RE/MAX National Housing Report record for the month.
Of the 53 metro areas surveyed in April 2018, the overall average number of home sales increased 3.6% compared to March 2018 and increased 2.3% compared to April 2017. Thirty-eight of the 53 metro areas experienced an increase in sales year-over-year including, Milwaukee, WI, 13.4%, Burlington, VT, 12.1%, Albuquerque, NM, 11.1%, and New Orleans, LA, at 9.1%.
Median Sales Price – Median of 53 metro median prices
In April 2018, the median of all 53 metro Median Sales Prices was $243,000, up 3.0% from March 2018 and up 7.5% from April 2017. Three metro areas saw a year-over-year decrease in Median Sales Price including, Trenton, NJ, -5.1%, Birmingham, AL, -3.0% and Wilmington/Dover, DE, -0.5%. Nine metro areas increased year-over-year by double-digit percentages, with the largest increases seen in Las Vegas, NV, 18%, Seattle, WA, 17%, Boise, ID, 15.8% and San Francisco, CA, 15.4%.
Days on Market – Average of 53 metro areas
The average Days on Market for homes sold in April 2018 was 52, down eight days from the average in March 2018, and down five days from the April 2017 average. The metro areas with the lowest Days on Market were San Francisco, CA, at 19, Seattle, WA, at 21, Denver, CO, at 23, and Las Vegas, NV, at 29. The highest Days on Market averages were in Augusta, ME, at 119, Burlington, VT, at 110 and Hartford, CT, at 91. Days on Market is the number of days between when a home is first listed in an MLS and a sales contract is signed.
Months Supply of Inventory – Average of 53 metro areas
The number of homes for sale in April 2018 was up 3.4% from March 2018, and down 11.3% from April 2017. Based on the rate of home sales in April, the Months Supply of Inventory remained at 2.5 from March 2018, and decreased compared to April 2017 at 2.8. A 6.0-months supply historically indicates a market that's balanced equally between buyers and sellers. In April 2018, all 53 metro areas surveyed reported a months supply at or less than 6.0, which is typically considered a seller's market. The markets with the lowest Months Supply of Inventory continue to be in the west with Boise, ID, Denver, CO, San Francisco, CA, and Seattle, WA, at 1.0.