Despite the housing shortage and April’s drop in home sales, the housing market not only returned to seasonally high sales, but set a post-recession record— the strongest home sales in the last nine years of RE/MAX’ reporting history. According to the RE/MAX National Housing Report, May sales increased 20.6 percent from April and 4.3 percent from May 2016.
The average amount of days on the market dropped to a record low of 51 days, consistent with the Months Supply of Inventory shrinking to 2.6 months. The lowest four metros were Omaha, Nebraska (20 days); San Francisco, California (21 days); Seattle, Washington (22 days); and Denver, Colorado (23 days). The highest average days on the market were in Augusta, Maine (136 days) and Burlington, Vermont (98 days).
“In May, we saw an uptick of both loan applications and home sales, which is encouraging in terms of more people getting into the market for homes,” said Adam Contos, RE/MAX Co-CEO. “We don’t expect that the Federal Reserve’s announcement on Wednesday to raise interest rates a quarter of a point will greatly affect the market’s momentum. But housing demand only intensifies the tug-of-war with tight inventories driving prices up.”
Close to breaking another RE/MAX reporting record, the May 2017 Median Sales Price was second highest at $232,500, only behind August 2008’s $236,062. Inventory continued to decline year-over-year to 16.2 percent from May 2016. According to RE/MAX, this is the 103rd consecutive month of year-over-year declines dating back to October 2008.
Fifty-two out of 53 metro areas experienced rising home values—an average of 5.3 percent increase. Some of the top metros include Albuquerque, New Mexico (+20.8 percent); Tulsa, Oklahoma (+13.4 percent); Las Vegas, Nevada (+12.2 percent); Honolulu, Hawaii (+11.5 percent); and Phoenix Arizona (+11.3 percent). Miami, Florida was the only metro area that saw a months supply above 6.0, which is considered a buyers market. The markets with the lowest Months Supply of Inventory were San Francisco, California and Seattle, Washington both at 0.9 and Denver, Colorado at 1.0 for the fourth month in a row.