As your trusted real estate resource, the Mendosa Balboni team has their finger on the pulse for current trends. This summer buyer demand has remained strong as it forced properties to go under agreement in less than a month for the 4th month in a row this past July. Both gains and dips were seen with sales across the nation this summer due to the limited housing stock, but in the end there was a slight dip in the numbers.
The total number of existing and completed home sale transactions had shown a slight decrease by 1.3% in July. However, this sales trend was still 2.1% higher than this time last year in 2016.
Lawrence Yun, NAR chief economist, says the second half of the year got off on a somewhat sour note as existing sales in July inched backward. “Buyer interest in most of the country has held up strongly this summer and homes are selling fast, but the negative effect of not enough inventory to choose from and its pressure on overall affordability put the brakes on what should’ve been a higher sales pace,” he said. “Contract activity has mostly trended downward since February and ultimately put a large dent on closings last month.”
Regarding home prices, the median price for homes in July was up by 6.2% over last year. This has been the 65th month in a row of year-over-year gains. Meanwhile, housing inventory has steadily declined for the past 26 year-over-year consecutive months which has led to the current state.
“Home prices are still rising above incomes and way too fast in many markets,” said Yun. “Realtors® continue to say prospective buyers are frustrated by how quickly prices are rising for the minimal selection of homes that fit buyers’ budget and wish list.”
The low level of inventory is the chief reason that most homes are not spending many days on the market lately. In July, 51% of the homes that sold that month were on the market for less than 30 days.
“July was the fourth consecutive month that the typical listing went under contract in under one month,” said Yun. “This speaks to the significant pent-up demand for buying rather than any perceived loss of interest. The frustrating inability for new home construction to pick up means inadequate supply levels will keep markets competitive heading into the fall.”
In numerous markets across the United States the fall market is traditionally an active market where sales can peak much like spring. It is anticipated that housing levels should increase as sellers look to take advantage of the busy season.