SANTA CLARA, Calif.,
July 9, 2019 /PRNewswire/ -- The
housing market is posed for a shift that could affect buyers well
into 2020 -- the resurgence of national inventory declines.
According to realtor.com®'s July
2019 Monthly Housing Trend report released today, in just a
few months* buyers may begin to see a drop in the number of homes
for sale that could lead to the return of bidding wars, stronger
price appreciation and quicker home sales.
Continuing its unabated record growth, the U.S. median listing
price in June reached its likely high point for the year at
$316,000, earlier than its usual July
peak due to the mismatch of what's available and what buyers
want.
Nationally, housing inventory grew 2.8 percent year-over-year,
an addition of approximately 40,000 listings, down from May's 2.9
percent growth. The slowing of inventory gains first appeared in
2019 with a decline from 6.4 percent growth in January to 5.8
percent in February. It continued throughout the spring with 4.4
percent growth in both March and April, 2.9 percent in May and now
2.8 percent in June. If this trend continues, inventory growth will
flatten over the next three months and could hit its first decline
in October 2019.
U.S. Inventory
Growth Year-over-Year in 2019
|
January
|
February
|
March
|
April
|
May
|
June
|
6.4%
|
5.8%
|
4.4%
|
4.4%
|
2.9%
|
2.8%
|
"It was only 18 months ago that the number of homes for sale hit
its lowest level in recorded history and sparked the fiercest
competition among buyers we've ever seen. If the trend we're seeing
continues, overall inventory could near record lows by early next
year," said Danielle Hale, chief
economist for realtor.com®. "So far there's been a
lackluster response to low mortgage rates, but if they do spark
fresh buyer interest later in the year, U.S. inventory could set
new record lows."
Part of this slowdown can be attributed to the fact that newly
listed homes have either declined or reported meager growth in
2019, such as June's 2.3 percent yearly decrease. According to
Hale, the reason why people aren't putting their homes on the
market is more difficult to determine. "It's likely a combination
of rate-lock, recently decreased consumer confidence and older
generations choosing to age in place," she added.
Only seven years ago, 30 year fixed mortgage rates reached their
lowest point at 3.3 percent since Freddie Mac began tracking this
data, which prompted many homeowners to refinance. Although rates
are still low, they're currently 50 basis points higher than they
were in December 2012 and higher than
one third of the weekly rates recorded over the last seven years,
which means a substantial number of homeowners have mortgages with
rates well below today's levels. If homeowners want to trade up,
they would not only have to pay more for a larger home, they would
pay more to finance it. Additionally, consumer confidence fell 4.4
percent over the past year, which could reflect consumer concerns
over a potential recession or future economic growth.
The time properties spent on the market in June 2019 was 56 days, a two-day increase from
last year. Additionally, the number of homes with price reductions
increased by 8.7 percent compared to the previous year, which means
one in five homes on the market this June had a price cut, compared
to one in six last year.
*Projections based on January-June
2019 inventory trend data and assume no disruption to
current trajectory.
For more information on realtor.com®'s June housing
trend report, please visit:
https://www.realtor.com/research/june-2019-data/
Editors note: Realtor.com® is upgrading
its database to a new system that allows for more enhanced listings
tracking. Market level trend data is being held until the
conversion is complete.
About realtor.com®
Realtor.com®,
The Home of Home Search℠, offers the most MLS-listed for-sale
listings among national real estate portals, and access to
information, tools and professional expertise that help people move
confidently through every step of their home journey. Through its
Opcity platform, realtor.com® uses data science and
machine learning to connect consumers with a real estate
professional based on their specific buying and selling needs.
Realtor.com® pioneered the world of digital real estate
20 years ago, and today is a trusted resource for home buyers,
sellers and dreamers by making all things home simple, efficient
and enjoyable. Realtor.com® is operated by News Corp
[Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. under a
perpetual license from the National Association of
REALTORS®. For more information, visit
realtor.com®.
Media Contact
Lexie Puckett
Holbert
lexie.puckettholbert@move.com
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SOURCE realtor.com