Inventory has been a ongoing issue in the housing market despite positive indicators from home sales and prices coming out of the crisis.
The March 2016 RE/MAX National Housing Report of 53 metros found that the number of homes for sale in February was 1.3 percent lower than in January and 13.3 percent lower than in February 2015.
According to the data, on a year-over-year basis in 2015, the average loss of inventory was 12.2 percent. The months supply of inventory was 4.0 in February, down from 4.6 percent in January and 4.7 supply in February 2015, where a six months supply indicates a balanced market between buyers and sellers.
RE/MAX said that Burlington, Vermont had the highest inventory in February at 11.1. Meanwhile, seven metros had a supply less than 2 months: Denver, Colorado (1.1), San Francisco, California (1.2), Seattle, Washington (1.2), Portland, Oregon (1.4), Dallas-Ft. Worth, Texas (1.8), San Diego, California (1.8), and Omaha, Nebraska (1.9).
“So far in 2016, January and February have both seen home sales at a pace higher than one year ago, and last year was one of the best our industry has seen in quite some time," said Dave Liniger, RE/MAX CEO, Chairman of the Board and Co-Founder. Consumers are benefiting from price increases that have been moderating, but many will still be dealing with an inventory lower than we’d like to see. Serious homebuyers who choose to work with an experienced agent will have a much easier time navigating this market,”
Bob Walters, Quicken Loans, Chief Economist added, “A lack of inventory continues to affect home values, as eager buyers compete for a small selection of homes. Home prices continue their long march back from the big price drops experienced in the financial crash. As more and more Americans gain equity, this increases the number of homeowners who are financially able to sell their home and buy another one. We’re seeing the benefits of this virtuous cycle in rising home prices, which are also being greatly aided by historically low mortgage rates."
The report showed that in the 53 metro areas surveyed in February, the average number of home sales was 4.8 percent higher year-over-year and was 5.8 percent higher than the previous month. The average home price for all homes sold in February was $198,000, down 1.0 percent from January. The median sales price has now risen for 49 consecutive months on a year-over-year basis. "Although price increases have been moderating over the last few months, low inventory supply continues to be the most significant factor pressuring prices," RE/MAX said.
Click here to view the full report.