Persistently depleted supply levels restrained existing-home sales in April and pushed the average number of days on the market for homes to a new low of 29 days, according to the National Association of Realtors®.
Total existing-home sales, which include completed transactions of single-family homes, condominiums, co-ops and townhomes, decreased 2.3% to a seasonally adjusted annual rate of 5.57 million in April. Despite last month’s decrease, sales remain at 1.6% above the same period 12 months ago.
NAR Chief Economist, Lawrence Yun, commented that the decrease in real estate closings was “somewhat expected”. He added that “a strong sales increase in March at 4.2% and [the fact that] new and existing inventory is not keeping up with the fast pace homes are coming off the market, demand is easily outstripping supply in most of the country and it’s stymieing many prospective home buyers from finding a home to purchase.”
Properties sat on the market for 29 days in April, which is down from 34 days in March and 39 days 12 months ago. It also surpasses last May’s low of 32 days as the shortest timeframe since NAR started tracking the data in May of 2011. Fifty-two percent of homes sold in April were on the market for less than a month, which indicates a new high of quick sales.
Total housing inventory at the end of April rose 7.2% to 1.93 million existing homes available for sale, yet this is still 9.0% lower than one year ago (which was 2.12 million). Inventory has fallen year-over-year for 23 successive months. Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.6 months a year ago.
The median existing-home price for all housing types in April was $244,800, up 6.0% from April 2016 ($230,900). April’s price increase marks the 62nd straight month of year-over-year gains. Homes in the U.S. are now 11.5% higher than they were just one year ago, according to the Real House Price Index (RHPI).*
“Real, purchasing-power adjusted house prices are rising even faster than unadjusted home prices alone, primarily due to declining consumer purchasing power,” Fleming said. “Strong Millennial demand, a limited supply of homes for sale, and higher mortgage rates have all combined to impact the affordability of homes compared to a year ago.”*