The current housing market serves as a classic illustration of the law of supply and demand. At this time, demand outstrips supply and prices increase as a result. The good news is that there were more sales in October compared to the previous month, but that’s tempered by the fact that there were fewer sales than a year earlier. Median prices continued to rise, extending the streak of year-over-year price increases. Homes continued to sell quickly, with median days on the market unchanged compared to September. Need I say it again? The sellers’ market continues.
October existing home sales rose by 2.0 percent compared to September, but were 0.9 percent lower than October 2016, according to the National Association of Realtors (NAR) October Existing Home Sales Report, released November 21st. It was the strongest sales month since June.
Hurricanes Harvey and Irma are still a factor in parts of Texas and Florida, but the recovery is underway. Those markets were strong before the storms hit and sales are expected to return to pre-storm levels by year-end.
Inventory fell from September to October by 3.2 percent, and is 10.4 percent lower year-over-year. This is the 29th month in a row that inventory has fallen. The supply of unsold inventory was 3.9 months, down from the 4.4 months in October 2016.
Home prices continued their year-over-year increase. The median price of existing homes sold in October was $247,000, up 5.5 percent from October 2016 ($234,100), and marking 68 consecutive months of year-over-year gains.
Days on the market (DOM) were that same as September at 34, but this is still a faster sales pace than October 2016, when homes typically stayed on the market for 41 days. Just under half of the homes sold in October were on the market for less than a month.
NAR chief economist Lawrence Yun commented, “Listings — especially those in the affordable price range — continue to go under contract typically a week faster than a year ago, and even quicker in many areas where healthy job markets are driving sustained demand for buying.” He went on to say, “With the seasonal decline in inventory beginning to occur in most markets, prospective buyers will likely continue to see competitive conditions through the winter.”
If you’re a seller – congratulations. This is a good time to sell. If you’re a buyer – don’t give up. Give yourself the edge by:
- Getting prequalified or preapproved by a First Choice Loan Services Inc. loan originator. You’ll know what you can afford and your offer will be stronger.
- Working with a real estate professional who knows the market that interests you. You’ll benefit from their knowledge and may find out about listings before they hit the internet.
- Making a reasonable offer. Rely on the advice provided by your real estate professional; this may not be the time to low-ball the asking price or add too many contingencies.
- Staying positive. Your new home is out there!