New data from realtor.com shows that homes are selling faster now than they were at this time one year ago, as buyers compete for limited inventory in the housing market.
Inventories are down 28% from a year ago, while the National Association of Realtors reported last month that existing home sales fell to an all-time low in December 2021.
With fewer listings of homes last week, buyer interest again outpaced homes available, said Danielle Hale, realtor.com’s chief economist, in a weekly analysis posted at the site.
“With fewer homes for sale now than this time last year, homes are selling faster and successful buyers have to move quickly,” Hale wrote.
Seventy-nine percent of homes sold in December 2021 were on the market for less than a month, according to the NAR. Properties typically remained on the market for just 19 days in December.
As rents rise at a double-digit pace, renters are looking to homeownership for the safety net of a steady mortgage and hopes of long-term appreciation. Mortgage rates that remain under 4% are also an incentive.
However, the fear of rising rates has driven a “rush on new-home sales as buyers try to sign contracts to lock-in rates and beat further cost increases,” Hale explained.
Hale believes housing indicators point to additional sellers entering the market this spring, which buyers would welcome as they look for a bigger selection in the housing market. Surveys show that more homeowners are planning to sell over the next 12 months. With single-family home construction at a 1 million–plus pace, inventory is expected to improve in the coming months.
“Additional housing supply is what’s needed to help first-time home buyers and add momentum to the homeownership rate,” Hale said.