The latest housing data report confirms an ongoing market trend: An evaporating inventory is contributing to declining home sales and a dramatically increase in home prices.
During July, Redfin
determined a 6.8 percent year-over-year spike in home prices, with the national median sale price reaching $293,000. However, sales were down 3.5 percent year-over-year, while the number of homes for sales dropped by 11 percent, which marked the 22nd consecutive month of year-over-year declines in inventory. While July’s three-month supply of homes was higher than June’s record-low 2.5 months, it was half of the six-month level that traditionally represents a balanced market between buyers and sellers.
Redfin also noted that every metro that is tracked, with the exceptions of Miami and Newark, N.J., had less than six months of supply. The greatest year-over-year declines in inventory were in San Jose (-43.7 percent), Rochester, N.Y. (-38 percent), Buffalo (-37.8 percent) and San Francisco (-29.3 percent). On the flip side, Salt Lake City had the highest increase in the number of homes for sale (up 27.9 percent), followed by Tulsa (23.3 percent) and Baton Rouge, La. (18 percent).
“In the first half of the year, the housing market was able to keep its head above water, despite high prices and low inventory, because buyer demand was so strong,” said Redfin Chief Economist Nela Richardson. “Multiple months of inventory declines took a toll on sales as buyers took a breather in July to wait for more listings. Despite last month’s sluggishness, the number of homes sold in the first seven months of the year was up four percent compared with the same period last year.”