Buyers looking for their perfect home on the West Coast need to move fast, judging by the results of Trulia’s latest look into how long homes stay on the market.
Trulia’s two-month study of metro areas around the U.S. this spring found that eight of the 10 fastest-moving housing markets are in California. The Bay Area, where fewer than 30 percent of homes remained on the market after two months, topped the list. Outside California, Seattle and Salt Lake City showed to be the markets where homes disappear from the listings quickly.
Across the country it’s a different story. The three slowest markets in Trulia’s study are in New York, the slowest being Long Island and Albany, where roughly 70 percent of homes remained on the market after two months.
One notable exception in the east is Cape Coral, Florida, where the pace of sales has shot up dramatically since last year. A year ago, Trulia found that about 60 percent of homes for sale in Cape Coral-Fort Myers were still listed after two months. This year, that percentage is down to 47. Richmond and El Paso had similar increases in sales pace.
Compared to a year ago, the overall pace of sales nationally has sped up. Last spring, about 62 percent of all homes Trulia track nationwide were still on the market at the 60-day mark. Wednesday’s report showed that number is now down to 60 percent.
What’s quickening the pace of sales? “It turns out it’s homes priced at the low end of the market,” said Trulia economist Ralph McLaughlin. Trulia gave each metro its own price cutoffs based on what’s considered high-end, mid-range, and low-end locally. “On average, lower-priced homes moved fastest,” McLaughlin said. “Only 50 percent of homes in this tier were still on the market after two months, compared with 65 percent of higher-priced homes.”
Price, however, can be deceiving. California’s homes in particular are high-dollar properties. But, McLaughlin said, expensive markets usually happen where inventory is tight and new construction in the face of growing demand is limited. “So homes get snapped up quickly,” he said. “And this is bad news for first-time homebuyers.”
Then again, so is the fact that homes at the lower end, especially in high-demand markets, are prime targets for homebuyers everywhere. “First-timers … are already getting slammed by declining affordability and slow wage growth,” McLaughlin said. “Now, even the homes they might be able to afford seem to be disappearing in the blink of an eye.”