While housing inventory remains extremely low compared with the pre-pandemic years (2017-2019) – down 37.8%, there is some good news for homebuyers.
Listings increased in November in 20 of the 50 largest metro areas compared with 2022. Leading the way were Memphis, TN (+25.1%), New Orleans (+25.0%) and San Antonia(+19.7%).
In the not-so-good news side of things, prices are rising as well led by Los Angeles (+23.1%), Richmond, VA (+16.4%), and Cleveland (+12.7%).
With home listings still in very short supply, would-be buyers understand that they need to make up their minds about bidding for a home -and fast! Between July 2020 and June 2021, the average home was on the market for one week before going under contract. According to the National Association of Realtors, this was a record low going back to 1989.
Certainly, virtual tours are helping buyers get a quicker feel for a home with 43 percent of buyers saying virtual tours were “particularly useful”.
While the housing market seems to be cooling off according to seasonal trends, demand for the existing listings remains extremely high.
Zillow’s October Real Estate Market Report states that the number of home for sale in the United States increased by 3 percent last month, compared to the same period in 2017. This is the first increase in home inventory in nearly four years.
Many of the country’s hottest markets saw the biggest increase in inventory, led by San Jose where 1,500 were added to the market in Ocotber. San Francisco, San Diego, and Seattle also saw significant increases in homes for sale.
Home value appreciation remained steady in October at 7.7 percent.
While housing inventory continued to decrease – down 0.2 percent in the last year – analysts say a turnaround may be coming with up to 8 percent increase in new listings, which would be the largest jump since 2013.
Larger cities are already seeing an in crease in listings with San Jose, Calif.; Seattle; Jacksonville, Fla.; San Diego; and San Francisco posting increases of 31 percent or more.
With inventory still low, houses are continuing to sell at a rapid pace with the average time on the market in the U.S. at 65 days. In the Bay Area, of course, houses sell at a much more rapid rate.
One of the prime factors behind high real estate prices is the lack of inventory. And one of the prime factors behind the lack of inventory is the shortage of construction workers. this includes home framers, masons, carpenters, electricians and others.
It is estimated that 900,000 single-family homes will be built in2018 while 1,200,000 are needed to meet demand.
Besides slowing the rate of construction, a lack of workers also means higher costs as subcontractors are increasing their rates by as much as 10 percent this year alone.
While March generally sees a boost in sales over the winter months – typically around a 45 percent increase – Bay Area home sales had a strong 60 increase in March 2017.
Prices increased 10 percent on a year-over-year basis and competitive bidding resulted in an increase in the number of homes selling over the asking price.
Inventory remains low, however, with the number of Bay Area homes for sale down nearly 8 percent from March 2016.