Home prices in February were pushed to a new high due to steady demand and low supply, according the recently released RE/MAX National Housing Report. Home sales posted a report record, though down 0.02 percent, as well as the median sales price at $212,000—up 6 percent year-over-year.
“Inventory, not the rise in interest rates, remains the principal constraint on home sales,” says Dave Liniger, RE/MAX co-founder, CEO and chairman of the board. “The resale market is driven dramatically by the availability of new homes. Most U.S. markets have a high demand for new home construction, and although it’s good to see housing starts trending upward, we still need more.”
Of the 53 metro areas surveyed in February 2017, the overall average number of home sales decreased 0.02 percent compared to February 2016. Of the 53 metro areas, 23 experienced an increase in sales year-over-year, with nine experiencing double-digit increases. The markets with the largest increase in sales included Trenton, N.J. (+26.2 percent), Nashville, Tenn. (+19.4 percent), Las Vegas, Nev. (+18.2 percent), Wichita, Kan. (+14.6 percent), and Birmingham, Ala. (+13.3 percent).
Median Sales Price
In February 2017, the median of all 53 metro median sales prices was $212,000, up 1.4 percent from January 2017 and up 6 percent from February 2016. Only six metro areas saw year-over-year decreases or remained unchanged, with 16 rising by double-digit percentages. The largest double-digit increases were seen in Fargo, N.D. (+19.9 percent), Burlington, Vt. (+18.4 percent), Tampa, Fla. (+15.9 percent), Indianapolis, Ind. (+14.3 percent), and Dallas/Ft. Worth, Texas (+13.9 percent).
Days on Market
The average days on market—the number of days between when a home is first listed in an MLS and a sales contract is signed—for homes sold in February 2017 was 68, up two days from the average in January 2017, but down seven days from the February 2016 average. The three metro areas with the lowest days on market were San Francisco, Calif., at 32, Omaha, Neb., at 34, and Denver, Colo., at 38. The highest days on market averages were in Augusta, Maine, at 147, and Chicago, Ill., at 109.
Months Supply of Inventory
The number of homes for sale in February 2017 was down 2.2 percent from January 2017, and down 17.9 percent from February 2016. Based on the rate of home sales in February, the months supply of inventory was 3.6, compared to January 2017 at 3.8 and February 2016 at 4.0. A 6.0-month supply indicates a market balanced equally between buyers and sellers. In February 2017, 45 of the 53 metro areas surveyed reported a months supply of less than 6.0, which is typically considered a seller’s market. The remaining eight saw a months supply above 6.0, which is typically considered a buyer’s market. The markets with the lowest months supply of inventory continued to be in the west, with both Denver, Colo., and Seattle, Wash., at 1.0 and San Francisco, Calif., at 1.1.
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