September Home Sales Slow Amid Strong Prices, Low Inventory

 

 

 

DENVER – September became the fifth month this year to post a decline in home sales compared to a record-setting 2016, while marking the 71st consecutive month of rising sale prices year-over-year, according to the October RE/MAX National Housing Report.

Joining August, July, April and February, September home sales dropped 4.2% year-over-year in the report’s monthly analysis of housing data in 54 metro areas. Going in the opposite direction, the Median Sales Price increased to $225,000. Though the lowest price since March, it was 2.3% higher than September 2016. The last month when home prices did not increase year-over-year was October 2011.

Three-quarters of the way through 2017, other notable numbers from the RE/MAX National Housing Report include:

In the wake of Hurricane Irma in early September, Miami saw home sales drop 35.2% year-over-year. Houston, meanwhile, posted a 3.2% gain despite the impact of Hurricane Harvey in late August.

Days on Market declined by one week, from 56 in September 2016 to 49.

At 3.6, the Months Supply of Inventory was the lowest of any September in the report’s 9-year history. Twenty-three markets are at 3 months or less.

Mirroring this, inventory dropped 14.1% year-over-year, with 46 metro areas seeing fewer homes for sale. Year-over-year, inventory has declined every month since November 2008.

“We’re not seeing any relief from the nationwide housing shortage as we enter the typically slower fall and winter selling seasons,” said Adam Contos, RE/MAX Co-CEO. “Plain and simple, we need more homes, particularly at the entry-level price point. Until then, it will most likely continue to be a seller’s market with homes going from listed to sold quickly.”

 

Closed Transactions

Of the 54 metro areas surveyed in September 2017, the overall average number of home sales decreased 14.9% compared to August 2017 and decreased 4.2% compared to September 2016. Sixteen of the 54 metro areas experienced an increase in sales year-over-year including, Billings, MT,+18.4%, Burlington, VT, +7.6%, Chicago, IL, 7.4%, Honolulu, HI, +4.6% and Las Vegas, NV +3.8%.

 

Median Sales Price – Median of 54 metro median prices

In September 2017, the median of all 54 metro Median Sales Prices was $225,000, down 5% from August 2017 but up 2.3% from September 2016. Only five metro areas saw a year-over-year decrease in Median Sales Price or remained unchanged (Trenton, NJ, -8.5%, Hartford, CT, -5.3%, Billings, MT, -2.2%, and Augusta, ME and Baltimore, MD at 0.0%). Eight metro areas increased year-over-year by double-digit percentages, with the largest increases seen in Seattle, WA, +13.7%, San Francisco, CA, +13.2%, Providence, RI, +13%, Las Vegas, NV, +12.2% and Tampa, FL, +11.4%.

 

Days on Market – Average of 54 metro areas

The average Days on Market for homes sold in September 2017 was 49, up two days from the average in August 2017, and down seven days from the September 2016 average. The four metro areas with the lowest Days on Market were Omaha, NE, at 23, Seattle, WA, at 25, and San Francisco, CA, at 26. The highest Days on Market averages were in Augusta, ME, at 105 and Burlington, VT, at 94. 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 54 metro areas

The number of homes for sale in September 2017 was down 3.6% from August 2017, and down 14.1% from September 2016. Based on the rate of home sales in September, the Months Supply of Inventory increased to 3.6 from August 2017 at 3.1, compared to September 2016 at 3.9. A 6.0-months supply indicates a market balanced equally between buyers and sellers. In September 2017, 51 of the 54 metro areas surveyed reported a months supply of less than 6.0, which is typically considered a seller’s market. The metro areas that saw a months supply above 6.0, which is typically considered a buyer’s market, were Miami, FL, at 11.8, Augusta, ME, at 6.4, and Birmingham, AL, at 6.3. The markets with the lowest Months Supply of Inventory continued to be in the west with San Francisco, CA, at 1.2, Seattle, WA, at 1.5, Denver, CO, at 1.6 and San Diego, CA, at 1.8.