Chronicle Journal: Finance

Frenzied Buyer Demand and Low Inventory Ignite Double-Digit Growth in Home Prices

SANTA CLARA, Calif., Sept. 3, 2020 /PRNewswire/ -- During a time when the typical homebuying season is showing signs of slowing down, home buyers were out in full force in August, scooping up homes at a rapid pace and sending the nation's median listing price up 10% to a new record of $350,000 as the nation's inventory of for sale homes reached new lows, according to realtor.com®'s August Monthly Housing Trends report.

Nationally, buyers continue to outnumber sellers as the inventory of available homes declined 36% in August year-over-year -- a faster pace than July when inventory was down 33%. New listings were down 12% year-over-year, a slight improvement over July's decline of 13%, but not nearly enough to make a dent in the overall inventory shortage. At the end of August, there were nearly 500,000 fewer homes available for sale compared to a year ago. 

The lack of available inventory and strong buyer demand combined to accelerate listing price growth to its highest level in three years, while the pace at which homes sold continued to pick up steam. On average, a home in the U.S. is selling in 56 days, five days faster than last year.

"It's difficult to imagine that the housing market will be able to sustain the frenzied demand we are currently experiencing, but we have yet to see any signs of slowing," said Danielle Hale, realtor.com® Chief Economist. "Buyer traffic on realtor.com is outpacing the record levels we saw earlier this year, suggesting that demand will continue to exceed the number of available homes for sale. Although demand is much more intense than it normally is this late into a buying season, the typical home asking price has likely peaked for the year at $350,000. However, given the strong demand, sellers will remain in the driver's seat for the foreseeable future."

In July, the number of homes listed for sale in the nation's 50 largest metros declined 38.1% year-over-year in August, up from the 34.8% year-over-year deficit in July. Forty four of the 50 largest metros experienced greater inventory declines than July despite an uptick in the volume of new listings in many of these same metros, underscoring just how hot the housing market is.

Indianapolis-Carmel-Anderson, Ind. (-55.9%); Riverside-San Bernardino-Ontario, Calif. (-55.5%); and Providence-Warwick, R.I.-Mass. (-51.7%); posted the largest inventory declines in August, while homes sold two, nine, and 10 days faster than last year in those markets, respectively.

Listing prices in the nation's largest metros grew by an average of 8.9% compared to last year, up from 7.8% in July. Of the largest 50 metros, 49 saw year-over-year gains in median listing prices in August.

The Northeast is leading the price gain with listing prices up nearly 19% in Philadelphia, 14.7% in Boston; and 12.2% in Providence-Warwick. On the West Coast, San Francisco saw listing prices increase 12%. The Miami-Fort Lauderdale-West Palm Beach market was the only metro to see a year-over-year decline, with listing prices falling 0.3% most likely due to the recent spike in Coronavirus cases and lower international buyer demand.

Metros With the Largest Price Gains

Metro

Median Listing
Price YoY

Median
Listing
Price

Median
Days on
Market Y-Y

Median
Days on
Market

New
Listing
Count YoY

Active
Listing
Count YoY

Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md.

18.6%

$343,000

-15

45

-7.4%

-45.1%

Cincinnati, Ohio-Ky.-Ind.

17.8%

$327,300

-5

44

-25.7%

-47.7%

Cleveland-Elyria, Ohio

15.6%

$232,500

-5

49

-25.3%

-50.2%

Boston-Cambridge-Newton, Mass.-N.H.

14.7%

$678,500

-14

38

-13.1%

-34.4%

Kansas City, Mo.-Kan.

12.9%

$345,100

0

51

-29.7%

-48.9%

San Francisco-Oakland-Hayward, Calif.

12.3%

$1,029,100

-1

35

-2.8%

-12.9%

Providence-Warwick, R.I.-Mass.

12.2%

$429,100

-10

46

-15.7%

-51.7%

Indianapolis-Carmel-Anderson, Ind.

11.8%

$299,600

-2

47

-27.7%

-55.9%

New Orleans-Metairie, La.

11.7%

$324,100

-4

66

-27.6%

-35.8%

Virginia Beach-Norfolk-Newport News, Va.-N.C.

11.7%

$335,000

-18

40

-5.2%

-44.9%

New York-Newark-Jersey City, N.Y.-N.J.-Pa.

11.6%

$619,100

-18

53

5.3%

-11.9%

Memphis, Tenn.-Miss.-Ark.

11.5%

$265,100

-6

48

-23.5%

-48.4%

Rochester, N.Y.

11.3%

$245,000

-12

29

-6.2%

-40.0%

Austin-Round Rock, Texas

10.7%

$400,000

-9

42

-8.6%

-39.9%

Riverside-San Bernardino-Ontario, Calif.

10.6%

$459,100

-9

46

-13.9%

-55.5%

Washington-Arlington-Alexandria, DC-Va.-Md.-W. Va.

10.5%

$525,100

-15

30

-7.0%

-43.7%

Detroit-Warren-Dearborn, Mich

10.2%

$279,100

-2

37

-21.8%

-41.7%

Richmond, Va.

10.1%

$358,000

1

52

-18.2%

-44.0%

St. Louis, Mo.-Ill.

9.5%

$250,000

1

58

-14.7%

-37.2%

Atlanta-Sandy Springs-Roswell, Ga.

9.1%

$354,100

-5

47

-18.2%

-41.7%

Denver-Aurora-Lakewood, Colo.

8.0%

$539,600

-6

36

-10.2%

-36.6%

San Diego-Carlsbad, Calif.

8.0%

$779,100

-7

35

-7.3%

-43.9%

Oklahoma City, Okla.

7.7%

$269,900

-1

50

-18.1%

-35.2%

San Jose-Sunnyvale-Santa Clara, Calif.

7.4%

$1,199,900

-10

32

21.6%

-26.1%

Tampa-St. Petersburg-Clearwater, Fla.

7.1%

$300,000

-8

52

-16.5%

-40.9%

Charlotte-Concord-Gastonia, N.C.-S.C.

7.1%

$370,100

-9

43

-18.2%

-46.9%

Hartford-West Hartford-East Hartford, Conn.

7.0%

$299,100

-19

44

-7.2%

-32.1%

Milwaukee-Waukesha-West Allis, Wis.

6.6%

$346,000

6

44

-12.0%

-41.6%

Chicago-Naperville-Elgin, Ill.-Ind.-Wis.

6.5%

$349,100

-4

42

-11.8%

-34.5%

Phoenix-Mesa-Scottsdale, Ariz.

6.5%

$415,100

-12

39

3.3%

-42.8%

Buffalo-Cheektowaga-Niagara Falls, N.Y.

6.5%

$225,100

4

43

-1.0%

-40.2%

Las Vegas-Henderson-Paradise, Nev.

6.4%

$343,600

-8

41

4.9%

-11.3%

Sacramento--Roseville--Arden-Arcade, Calif.

6.2%

$528,100

-6

37

-8.6%

-51.1%

Louisville/Jefferson County, Ky.-Ind.

6.1%

$285,000

-7

38

-30.3%

-50.1%

San Antonio-New Braunfels, Texas

5.9%

$313,700

-6

51

-8.6%

-39.2%

Birmingham-Hoover, Ala.

5.9%

$272,200

-6

52

-8.0%

-36.3%

Portland-Vancouver-Hillsboro, Ore.-Wash.

5.8%

$500,100

-4

42

-9.3%

-42.4%

Columbus, Ohio

5.7%

$316,400

-7

35

-17.7%

-46.5%

Nashville-Davidson--Murfreesboro--Franklin, Tenn.

5.5%

$396,000

-5

32

-17.2%

-32.5%

Houston-The Woodlands-Sugar Land, Texas

5.3%

$329,700

-5

51

-9.5%

-29.3%

Baltimore-Columbia-Towson, Md.

5.2%

$350,000

-14

42

-11.6%

-51.6%

Seattle-Tacoma-Bellevue, Wash.

4.3%

$625,100

-8

33

-1.7%

-27.3%

Minneapolis-St. Paul-Bloomington, Minn.-Wis.

4.2%

$360,100

-5

36

-3.6%

-28.4%

Dallas-Fort Worth-Arlington, Texas

3.5%

$360,000

-4

46

-16.0%

-40.1%

Raleigh, N.C.

3.5%

$386,200

-15

43

-10.8%

-37.9%

Jacksonville, Fla.

2.3%

$320,100

-7

63

-16.2%

-35.8%

Orlando-Kissimmee-Sanford, Fla.

0.8%

$325,000

-2

58

-2.1%

-17.5%

Miami-Fort Lauderdale-West Palm Beach, Fla.

-0.2%

$405,100

-5

93

-3.2%

-12.8%

Pittsburgh, Pa.

N/A*

$250,000

-6

54

-8.1%

-34.6%

Los Angeles-Long Beach-Anaheim, Calif.

N/A*

$999,100

N/A*

51

-9.5%

-26.6%

* Some data points for Pittsburgh and Los Angeles have been excluded due to data unavailability.

About realtor.com®
Realtor.com® makes buying, selling and living in homes easier and more rewarding for everyone. Realtor.com® pioneered the world of digital real estate 20 years ago, and today through its website and mobile apps is a trusted source for the information, tools and professional expertise that help people move confidently through every step of their home journey. Using proprietary data science and machine learning technology, realtor.com® pairs buyers and sellers with local agents in their market, helping take the guesswork out of buying and selling a home. For professionals, realtor.com® is a trusted provider of consumer connections and branding solutions that help them succeed in today's on-demand world. 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 Contacts: 
Nicole Murphy, nicole.murphy@move.com 
Lexie Holbert, lexie.holbert@move.com

 

Cision View original content:http://www.prnewswire.com/news-releases/frenzied-buyer-demand-and-low-inventory-ignite-double-digit-growth-in-home-prices-301123653.html

SOURCE realtor.com

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