The housing market is unable to sustain what is becoming an increasingly “frenzied demand” for what limited homes there are for sale on the market, analysts said last week.
A new report from realtor.com published last week shows that homes are getting more expensive while also selling much faster than before. In the last month, the national median listing price rose 10% to a new record high of $350,000, while homes are now selling at their fastest pace in 15 months. Meanwhile, the number of homes available to buy has fallen to a new, record low.
“It’s difficult to imagine that the housing market will be able to sustain the frenzied demand we are currently experiencing, but we have yet to see any signs of slowing,” said Danielle Hale, realtor.com’s chief economist. “Buyer traffic on realtor.com is outpacing the record levels we saw earlier this year, suggesting that demand will continue to exceed the number of available homes for sale.”
Demand for homes is far more intense than it normally is at this time of the year, Hale said. As such, she expects sellers to remain in the “driver’s seat” for some time to come.
Inventory dropped 36% in August compared to the year prior. The largest drop in housing inventories in August occurred in Indianapolis-Carmel-Anderson, Ind. (down 55.9%); Riverside-San Bernardino-Ontario, Calif. (down 55.5%); and Providence-Warwick, R.I.-Mass. (down 51.7%).
The lack of homes for sale continues to press on home prices. The Northeast led in listing price gains annually, up nearly 19% in Philadelphia, 14.7% in Boston, and 12.2% in Providence-Warwick, R.I. On average, homes nationwide are selling in 56 days, which is five days faster than a year ago, according to realtor.com.