The June RE/MAX National Housing Report shows that the housing recovery is real, as on a year-to-year basis, home sales have now risen for 12 consecutive months and prices have inched higher for the past five months. Of the 53 metro areas included in the survey, 31 report increases in both sales and prices. It appears that the recovery is broad based, occurring in all geographic regions. Increased consumer confidence, historically low mortgage rates and attractive pricing are some of the factors that are drawing buyers and sellers back into the real estate market. Available homes for sale dropped five percent from May and 27.4 percent from June 2011. This declining inventory has created a seller’s market in many areas with multiple bids and offers occurring frequently. An Average Days on Market of 84 in June is the lowest since August 2010.
"Although the housing market has a long way to go to make a full recovery, all signs now show that it’s on the right path and has improved every month so far this year,” said Margaret Kelly, chief executive officer of RE/MAX LLC. “This selling season is the best in years, and those who thought that the positive trends would quickly correct have been proven wrong, because many consumers again feel comfortable buying or selling a home.”
Closed transactions for June increased 2.1 percent from May and five percent from June last year. These figures make June the twelfth month that transactions have been higher than the same month in the previous year and the fifth time transactions have increased over the previous month. Favorable market conditions are attracting both sellers and buyers, as well as investors. Of the 53 metro areas surveyed, 40 saw higher sales than one year ago, with many New England markets leading the way: Fargo, N.D. +37.1 percent; Providence, R.I. +29.5 percent; Burlington, Vt. +27.5 percent; Manchester, N.H. +27.2 percent; Augusta, Maine +25.2 percent; and Chicago, Ill. +22.1 percent.
The Median Sales Price of homes sold in June was $170,067. This price marks a 2.5 percent rise from the median in May and a 3.7 percent increase from June 2011. June also marks the fifth consecutive month for both month-to-month and year-to-year price increases. Of the 53 metro areas surveyed for the June RE/MAX National Housing Report, a near record 44 experienced price increases over the last year, with six metro areas experiencing double digit gains: Phoenix, Ariz. +29.5 percent; Detroit +23.3 percent; Miami, Fla. +21.5 percent; Boise, Idaho +16.3 percent; Denver +14.9 percent; and Pittsburgh, Pa. +9.5 percent.
The average Days on Market for homes sold during the month of June was 84, representing a significant drop of eight days from May and six days below June 2011. June represents the first month since September 2011 with a Days on Market below 90 and the lowest average since August 2010. A falling Days on Market average is due to the low inventory that many markets are experiencing. Days on Market is the number of days between first being listed in an MLS and when a sales contract is signed.
The inventory of homes for sale fell five percent from May and 27.4 percent from inventory levels seen in June 2011. Month-to-month inventories have now fallen for 24 consecutive months. A diminishing inventory is helping home prices rise. Given the current rate of sales, the average Months Supply is now 5.0, about two months lower than the 6.9 average for June last year. Very low Months Supply has been seen in San Francisco at 1.2; Los Angeles at 1.8; Denver at 2.3; Orlando, Fla. at 2.5; and Phoenix, Ariz. at 3.1