Inventory shortage has been a recurring theme in this year’s housing news. But a new report by Realtor.com indicates that future home value appreciations will depend more on market demand and less on the dearth of available properties.
Based on an analysis of the summer home buying season ending in August, year-over-year changes were in the single digits for inventory count, median age, and median list price, suggesting that the market is leveling out. That’s positive news, says Steve Berkowitz, CEO of Move. “Where we have seen significant volatility in many markets, including double-digit declines in inventory as well as increases in median price for both yearly and monthly views, we are now looking at a housing market that much more closely resembles ‘normal’…the fact that this moderation is becoming evident in more markets, and that rising mortgage interest rates are not yet affecting overall market activity, is further evidence of a much more stable housing marketplace.”
Here are a few of the report’s highlights:
- Inventory across the nation has stabilized. One-third of the 146 Metropolitan Statistical Areas (MSAs) covered by realtor.com are within 5 percent of last year’s inventory levels, and more than two-thirds posted a net increase in inventory over last month.
- The national median list price did not change from July to August, but industry experts do anticipate a moderate rise in home prices.
- Year-over-year median list price increased in 123 of the 146 MSAs.
- Median age of inventory increased month-over-month in 130 MSAs; Seattle (with 25 percent) was one of three cities that showed a significant gain.