Inventory Crunch Easing As Sellers Jump Back In The Market
Are the days of low housing inventory coming to a close?
There are definitely encouraging signs: the number of listings on realtor.com increased 2.36% in March, a welcome change from the -15.22% inventory free fall the market has been in for the past year. Bolstering the positive news is a .05% increase in listing prices and a sizable 20% decrease in the median age of inventory since February.
The national average list price of $190,000 seems to have changed the calculus for homeowners thinking of selling, tempting them off the sidelines with prices that may be break even – or even profit-making – depending on the structure of their current mortgage. As more homeowners are pulled out of the quicksand of negative equity by appreciating prices, a key roadblock to a widespread housing recovery could dissolve as the inventory crunch gives way to pent-up demand from sellers and buyers.
Some markets are already showing strong signs of life. California continues its rebound, and Denver, Detroit and Seattle are experiencing promising growth. The median age of inventory has dropped to 24 days in Denver, Detroit’s list prices have increased at a faster rate than San Diego and are just behind San Fransisco, and Seattle’s median list price has jumped 15.9% since last year.
National Data
- In March, the total number of single-family homes, condos, townhomes and co-ops for sale in the U.S. (1,529,432) increased by 2.36 percent month-over-month. On an annual basis, however, inventory decreased by 15.22 percent.
- The national median list price for single-family homes, condos, townhomes and co-ops ($190,000) increased by .05 percent both year-over-year and month-over-month in March.
- The median age of inventory of for sale listings fell to 78 days in March, down 20.41 percent from February and 12.35 percent below the median age one year ago (March 2012).
Local Data
- California continues to lead the list of the country’s top performing housing markets with largest year-over-year decline in for-sale inventories. Seattle is the only market outside of California in the top 10, and experienced a decline of 40.17 percent in for-sale inventories year-over-year. The 10 markets with the largest year-over-year declines in inventory include Stockton-Lodi, Sacramento, Orange County, Oakland, San Jose, Los Angeles-Long Beach, Ventura, San Diego, Riverside-San Bernardino and Seattle, WA. Out of the 146 markets realtor.com monitors, only nine experienced an increase in for-sale inventory.
- On an annual basis, March median list prices were up by 5 percent or more in 52 markets, while only six markets experienced a decline of more than 5 percent. California markets continue to experience the largest median list prices year-over-year, in addition to the Phoenix market. While Detroit and Fresno did not make the list of top 10 performers for median list price, both markets did see list prices increase more than 40 percent year-over-year.
- The 10 areas with the longest time on market continued to include the coastal areas of the Carolinas and the resort communities of Santa Fe, NM, and Asheville, NC. In addition, four older industrialized areas also appear on the list: Reading, PA, Portland, ME, Albany, NY, and Philadelphia. However, with the exceptions of Albany and Philadelphia, the average age of the inventory in the remaining areas is down compared to one year ago.